Boston U. Questrom School of Business, United States
We study the effect of changes in the minimum wage on the employment of undergraduate research assistants in university labs. Using administrative data from thousands of research labs and a difference-in-differences framework, we find scientists employ 7.1% fewer undergraduates in their labs following minimum wage increases. In the short-run, labs appear to substitute with increased employment of graduate students. In the long-run, labs compensate for higher labor costs by being 10% more likely to utilize supplemental funding. Finally, we estimate the impact of these price shocks on students' exposure to scientific work. We show that undergraduate research assistants who experience minimum wage increases graduate with 8.2% fewer quarters employed in labs, although this is attenuated for students paid by Federal Work Study. Our analysis demonstrates the implications of input price shocks for the scientific workforce and highlights the importance of budget flexibility for sponsored research at universities seeking to provide undergraduates with research experience.
