Paying More, Asking More: Minimum Wages and the Skill Content of Labor Demand
In October 2022, Germany raised its statutory minimum wage from 9.82€ to 12.00€, an increase of more than 20 percent in a single year. Research on the reform has focused on wages, hours, and employment, but firms may also change what they ask of new hires. I examine whether more exposed occupations changed their skill demand more strongly after the reform, in the quantity, diversity, and composition of the skills requested. Combining administrative wage data from the German Earnings Survey with 5.8 million online job vacancies, I measure each occupation-region cell’s exposure from the pre-reform wage distribution and extract the skills firms request from the vacancy texts. In a difference-in-differences design, more exposed cells request more skills per vacancy after the reform, concentrated in cognitive and manual requirements. The added demand falls on skills already central to the occupation rather than on a wider range, as the diversity of skills requested remains unchanged. Demand also shifts toward cognitive skills and away from soft ones. At the lower end, helper postings increasingly ask for skills typical of skilled-worker jobs. The effects are small but robust, and concentrated in the most exposed occupation-region cells.