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DOI: 10.1177/0891242404268634 The Effect of Detroits Living Wage Law on Nonprofit Organizations
Wayne State University A common argument made against local passage of living wage laws is that they harm nonprofit organizations by compelling employerswith tight, strained budgetsto increase wages. Ninety-six nonprofits covered by Detroits living wage law were contacted 1 1/2 years after the 1998 law had gone into effect. Although a small number of nonprofit employers needed help to implement the living wage requirements, overall, the living wage law neither had a negative effect on nonprofit organizations nor did it result in appreciable job losses. The studys findings are relevant not simply to other municipalities whose laws cover nonprofit employers but to living wage laws generally. If living wage laws are harmful to employers or employees, the effect should be most pronounced among the most vulnerable employersnamely, nonprofit organizations. This research confirms that living wage requirements do not generally pose a significant cost relative to contract amounts, employersoverall budgets, or the local municipal budget.
Key Words: living wage nonprofit organizations wage policy public policy
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