Interesting paper on the topic.
http://www.cepr.net/documents/publications/min-wage-2013-02.pdf
Conclusion of the paper:
Economists have conducted hundreds of studies of the employment impact of the minimum wage.
Summarizing those studies is a daunting task, but
two recent meta-studies analyzing the research
conducted since the early 1990s concludes that the minimum wage has little or no discernible effect
on the employment prospects of low-wage workers.
The most likely reason for this outcome is that the cost shock of the minimum wage is small relative
to most firms' overall costs and only modest relative to the wages paid to low-wage workers. In the
traditional discussion of the minimum wage, economists have focused on how these costs affect
employment outcomes, but employers have many other channels of adjustment. Employers can
reduce hours, non-wage benefits, or training.
Employers can also shift the composition toward
higher skilled workers, cut pay to more highly paid workers, take action to increase worker
productivity (from reorganizing production to increasing training), increase prices to consumers, or
simply accept a smaller profit margin. Workers may also respond to the higher wage by working
harder on the job.
But, probably the most important channel of adjustment is through reductions in
labor turnover, which yield significant cost savings to employers.
And furthermore:
The strongest evidence suggests that the most important channels of adjustment are: reductions in
labor turnover; improvements in organizational efficiency; reductions in wages of higher earners
("wage compression"); and small price increases.
So employers tend to keep labor longer, improve their own efficiency, reduce wages of higher earners, and pass on the costs to the consumer. OH THE HUMANITY THAT THIS WOULD OCCUR.
Another interesting point people have talked about on here from a 2012 study on the minimum wage topic:
""Using... standard fiscal multipliers to analyze the jobs impact of an increase in
compensation of low-wage workers and decrease in corporate profits that result
from a minimum-wage increase, we find that increasing the national minimum wage
from $7.25 to $9.80... would result in a net increase in economic activity of
approximately $25 billion over the phase-in period and... generate approximately
100,000 new jobs."
And then there's this from a 2010 study:
"Employers may also absorb the extra costs associated with a minimum-wage increase by accepting
lower profits. Unfortunately, "there is almost a complete absence of any study directly examining
the impact of minimum wages on firm profitability"