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A Re-examination of the Impact of the UK National Minimum Wage on Employment

Author

Listed:
  • Richard Dickens
  • Rebecca Riley
  • David Wilkinson

Abstract

type="main" xml:id="ecca12158-abs-0001"> Early work on the national minimum wage (NMW) suggested that policymakers in the UK had succeeded in raising the pay of low-paid workers without impairing their employment prospects. This paper shows that when we focus on the most vulnerable workers, part-time females, the NMW appears to be associated with reductions in employment retention. These negative impacts were evident when the NMW was introduced and also when it was increased faster than average wages in the mid-2000s. We also show that these falls in employment among part-time females are exacerbated by the recession.

Suggested Citation

  • Richard Dickens & Rebecca Riley & David Wilkinson, 2015. "A Re-examination of the Impact of the UK National Minimum Wage on Employment," Economica, London School of Economics and Political Science, vol. 82(328), pages 841-864, October.
  • Handle: RePEc:bla:econom:v:82:y:2015:i:328:p:841-864
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    File URL: http://hdl.handle.net/10.1111/ecca.2015.82.issue-328
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    References listed on IDEAS

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    1. Peter Dolton & Chiara Rosazza Bondibene & Jonathan Wadsworth, 2012. "Employment, Inequality and the UK National Minimum Wage over the MediumÔÇÉTerm," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 74(1), pages 78-106, February.
    2. Stewart, Mark B, 2002. " Estimating the Impact of the Minimum Wage Using Geographical Wage Variation," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(0), pages 583-605, Supplemen.
    3. Richard Dickens & Alan Manning, 2004. "Has the national minimum wage reduced UK wage inequality?," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 167(4), pages 613-626.
    4. Mark B. Stewart, 2004. "The Impact of the Introduction of the U.K. Minimum Wage on the Employment Probabilities of Low-Wage Workers," Journal of the European Economic Association, MIT Press, vol. 2(1), pages 67-97, March.
    5. Peter Dolton & Chiara Rosazza Bondibene, 2012. "The international experience of minimum wages in an economic downturn," Economic Policy, CEPR;CES;MSH, vol. 27(69), pages 99-142, January.
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    Citations

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    Cited by:

    1. Seltzer, Andrew & Borland, Jeff, 2016. "The Impact of the 1896 Factory and Shops Act on Victorian Labour Markets," IZA Discussion Papers 10388, Institute for the Study of Labor (IZA).
    2. repec:esr:resser:bkmnext332 is not listed on IDEAS
    3. repec:esr:resser:bkmnext354 is not listed on IDEAS
    4. Cai, Lixin & Mavromaras, Kostas G. & Sloane, Peter J., 2016. "Low Paid Employment in Britain: Estimating State-Dependence and Stepping Stone Effects," IZA Discussion Papers 9633, Institute for the Study of Labor (IZA).
    5. McGuinness, Seamus & Redmond, Paul, 2018. "Estimating the effect of an increase in the minimum wage on hours worked and employment in Ireland," Research Series, Economic and Social Research Institute (ESRI), number BKMNEXT354.
    6. Roy E. Bailey & Timothy J. Hatton & Kris Inwood, 2016. "Atmospheric Pollution and Child Health in Late Nineteenth Century Britain," CEH Discussion Papers 052, Centre for Economic History, Research School of Economics, Australian National University.
    7. McVicar, Duncan & Park, Andrew & McGuinness, Seamus, 2018. "Exploiting the Irish Border to Estimate Minimum Wage Impacts in Northern Ireland," IZA Discussion Papers 11585, Institute for the Study of Labor (IZA).
    8. Jan Fidrmuc & J. D. Tena, 2013. "National Minimum Wage and Employment of Young Workers in the UK," CESifo Working Paper Series 4286, CESifo Group Munich.
    9. Wannaphong Durongkaveroj, 2017. "Minimum Wage and Lives of the Poor: Evidence from Thailand," PIER Discussion Papers 76, Puey Ungphakorn Institute for Economic Research, revised Nov 2017.
    10. Riley, Rebecca & Rosazza Bondibene, Chiara, 2017. "Raising the standard: Minimum wages and firm productivity," Labour Economics, Elsevier, vol. 44(C), pages 27-50.
    11. Rebecca Riley & Chiara Rosazza-Bondibene, 2015. "Raising the Standard: Minimum Wages and Firm Productivity," National Institute of Economic and Social Research (NIESR) Discussion Papers 449, National Institute of Economic and Social Research.

    More about this item

    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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