Living Wage Laws in Practice: The Boston, New Haven and Hartford Experiences

In the last decade more than 120 local governments have adopted living wage laws – measures designed to ensure that private-sector workers providing public services through city contracts make enough to keep their families out of poverty. Close to 20 percent of the U.S. population now lives in that have living wage laws on the books. Despite the proliferation of living wage laws, relatively few studies have examined what the actual impacts have been of these measures. A new report from Mark Brenner and Stephanie Luce "Living Wage Laws in Practice: The Boston, New Haven and Hartford Experiences" fills that gap. It is the most comprehensive research to date on how living wage laws really work. Drawing on data from Boston, New Haven, and Hartford, this study explores the effect of living wage laws on city contract costs, covered firms, and the living standards of low-wage workers.  The authors find that these laws have led to concrete improvements in the lives of workers and their families, without harming firms covered by their mandates or consistently raising costs for cities. However, these improvements in the living standards of workers and their families have been modest. But the living wage measures have also served as springboards for advancing more comprehensive efforts improving to improve the living standards of low-wage workers and their families. Key findings include: * The Boston, New Haven, and Hartford experiences indicate that living wage laws do not tend to raise contract costs, and can strengthen competition among city contractors. These laws are only one of many factors influencing the cost and competitiveness of city procurement. * Contrary to many predictions, living wage laws did not prompt affected firms to cut jobs or reduce employees' hours. In fact, covered firms were more likely to transform part-time jobs into full-time following living wage implementation. Evidence suggests that affected firms are adjusting to higher labor costs by lowering profits rather than resorting to layoffs. * The high incidence of poverty among affected workers before the living wage shows that the law is well targeted to the working poor. Poverty also declined significantly among workers covered by the law. However, the living wage did not succeed in lifting covered workers and their families up to a more substantial standard of living that reflects the spirit and intent of the living wage law.