a column by Giulia Giupponi and Stephen Machin for VOX: CEPR’s Policy Portal
n 2016 the National Living Wage in the UK raised the minimum hourly wage for workers aged 25 and over.
The column uses data from English care homes to analyse the impact of this policy, finding that the main non-wage effect has been a deterioration in quality of care. Younger colleagues also received wage rises, which seems to reflect a preference for fairness among employers.
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Showing posts with label national_living_wage. Show all posts
Showing posts with label national_living_wage. Show all posts
Wednesday, 29 August 2018
Thursday, 9 November 2017
The national living wage has caused the biggest fall in low pay in 40 years – but how is this improving people’s living standards?
a post by George Bangham for the Resolution Foundation blog
Employment is at a 40-year high, while pay is stagnating. That, in brief, sums up the last few years of changes in Britain’s labour market.
But the good news on employment has failed drastically to translate into a pay rise. A new squeeze on Britain’s median pay began in February 2017 – as Figure 2 shows – ending 27 consecutive months of real pay growth. This was due mainly to the late-2016 rise in inflation, attributable mainly to the weaker post-referendum pound, which pushed real pay down year-on-year despite nominal pay growth consistently topping 2% since early 2015. Newly-released October 2017 data from the Annual Survey of Hours and Earnings confirms that the new pay squeeze turns up in HMRC data too. Most observers don’t expect inflation to persist at its current level throughout 2018, as the effects of currency devaluation ‘pass through’, so today’s pay squeeze should change course in 2018. But with nominal wage rises still far below pre-crisis levels there are few signs that Britain can expect broad-based wage growth in the near future.
Continue reading there are several interesting graphs which make the problem very clear.
Employment is at a 40-year high, while pay is stagnating. That, in brief, sums up the last few years of changes in Britain’s labour market.
But the good news on employment has failed drastically to translate into a pay rise. A new squeeze on Britain’s median pay began in February 2017 – as Figure 2 shows – ending 27 consecutive months of real pay growth. This was due mainly to the late-2016 rise in inflation, attributable mainly to the weaker post-referendum pound, which pushed real pay down year-on-year despite nominal pay growth consistently topping 2% since early 2015. Newly-released October 2017 data from the Annual Survey of Hours and Earnings confirms that the new pay squeeze turns up in HMRC data too. Most observers don’t expect inflation to persist at its current level throughout 2018, as the effects of currency devaluation ‘pass through’, so today’s pay squeeze should change course in 2018. But with nominal wage rises still far below pre-crisis levels there are few signs that Britain can expect broad-based wage growth in the near future.
Continue reading there are several interesting graphs which make the problem very clear.
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