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This study estimates the employment effects of industry‐specific, collectively bargained minimum wages in Germany for two occupations associated with the construction sector. I propose a truly exogenous control group in contrast to the control group design used in the literature. Further, a difference‐in‐differences‐in‐differences estimator is presented as a robustness test for occupation‐specific and/or industry‐specific, time‐varying, unobserved heterogeneity. I do not find a significantly negative employment effect, even though the minimum wage is binding in (East) Germany. Possible explanations include substitution effects, non‐compliance and models of monopsonic competition.

The Employment Effect of Industry‐Specific, Collectively Bargained Minimum Wages