Where Minimum Wage Bites Hard: The Introduction of the UK National Minimum Wage to a Low Wage Sector
Stephen Machin (),
Alan Manning () and
No 145, Royal Economic Society Annual Conference 2003 from Royal Economic Society
Between 1993 and April 1999 there was no minimum wage in the UK (except in agriculture). In this paper we study the effects of the introduction of a National Minimum Wage (NMW) in April 1999 on one heavily affected sector, the residential care homes industry. This sector contains a large number of low paid workers and as such can be viewed as being very vulnerable to minimum wage legislation. We look at the impact on both wages and mployment. Our results suggest that the minimum wage raised the wages of a large number of care homes workers, causing a very big wage compression of the lower end of the wage distribution, thereby strongly reducing wage inequality. There is some evidence of employment and hours reductions after the minimum wage introduction, though the estimated effects are not that sizable given how heavily the wage structure was affected.
New Economics Papers: this item is included in nep-lab
References: Add references at CitEc
Citations: View citations in EconPapers (65) Track citations by RSS feed
Downloads: (external link)
http://repec.org/res2003/Machin.pdf full text
Working Paper: Where the minimum wage bites hard: the introduction of the UK national minimum wage to a low wage sector (2003)
Working Paper: Where the Minimum Wage Bites Hard: the Introduction of the UK National Minimum Wage to a Low Wage Sector (2002)
Working Paper: Where the minimum wage bites hard: the introduction of the UK national minimum wage to a low wage sector (2002)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ecj:ac2003:145
Access Statistics for this paper
More papers in Royal Economic Society Annual Conference 2003 from Royal Economic Society Contact information at EDIRC.
Bibliographic data for series maintained by Christopher F. Baum ().