The future of the minimum wage – The worker perspective

The minimum wage is one of the most successful policies in recent decades. Its introduction helped nearly eliminate extreme low pay, and more recent increases have boosted hourly pay for those at the bottom of the income distribution without a significant negative impact on employment. The minimum wage has achieved a deep and lasting political consensus.

While there has been much focus on the views of employers and their ability to respond to minimum wage increases, there has been less emphasis on the voice of workers. This report – the first in a series on the future of the minimum wage led by Learning and Work Institute and Carnegie UK Trust – explores public perceptions of the minimum wage, and the views of low paid workers in particular.

The report highlights the strong and broadly based support for further increases in the minimum wage, with particularly strong support among low income households, young people, and those in lower socio-economic groups. However, while low paid workers are very supportive of increasing the wage floor, many are sceptical about the impact this will have on their financial situation, and how employers will respond.

When it comes to the potential trade offs involved in increasing the minimum wage, more adults tend to favour a cautious approach which minimises any risk of increased unemployment, compared to a more ambitious approach to raising the wage floor even if this risked a small rise in unemployment.

In the next report in the series, we will be exploring employer views of a higher wage floor, and how they may adapt.

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