Gender management strategies in response to minimum wage increases in Romania

Abstract

The minimum wage policy is crucial in relaunching the economies, affecting both companies and employees. Through this paper we investigate how small and medium-sized enterprises (SMEs) react to increases in the minimum wage. We used data collected from a survey conducted in 2019 on a representative sample on Romanian companies. The effects of the minimum wage policy on SMEs, broken down by gender management types, were studied through a methodological approach that used the propensity score matching technique. The results showed that, after a minimum wage increase, female management reacts differently than male management. Female leadership mainly focuses on keeping the staffing scheme, maintaining the salary level and increasing labor productivity through innovation, while male leadership prefers to restrict salary increases or reduce bonuses or other benefits, but at the same time to increase the price of the products/services offered and to reduce non-wage costs.