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A significant moment for the minimum wage

19 March 2012

2:03 PM

19 March 2012

2:03 PM

Here are some numbers for you: the adult rate of the national minimum wage will be raised, this October, by 11p to £6.19 an hour, but the separate rates for 16-17 and 18-20 year-olds will be
frozen, at £3.68 and £4.98 respectively. I mention this not just because these figures were announced today, but also because it’s the first cash freeze in any of the rates that we’ve seen
since 2005 (and even that was when the 16-17 year-old rate was kept at the same level after its very first year of existence):

The question is, what now? The government is defending the freeze by saying that, ‘Raising the youth rate would not benefit young people if it meant it was more difficult for them to find a
job’ — and rightly so. But this is a more significant argument than it first appears. By effectively arguing that an increased minimum wage may dissuade employers from hiring, could the
coalition be setting the ground for, say, regionalising or even suspending it for young people?

Such ideas have certainly circulated around Downing Street recently, and they even predate
the coalition
. I might be reading too much into it, but today certainly feels like a step towards making them reality.


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