Minimum Wage

(asked on 8th April 2016) - View Source

Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, how many workers his Department estimates will be financially worse off as a result of the recent increase in the minimum wage.


Answered by
Damian Hinds Portrait
Damian Hinds
This question was answered on 18th April 2016

The introduction of the National Living Wage on April 1st marked a pay rise for low paid workers across the UK. Our objective is for it to reach over £9 by 2020. This means an employee aged 25 or over working full-time on the National Minimum Wage will earn over £4,200 a year more by 2020 in cash terms, or £3,800 after taking into account inflation. 2.9m low wage workers are expected to benefit directly, and up to 6m could see a pay rise as a result of a ripple effect up the earnings distribution.

The independent Office for Budget Responsibility estimated that the NLW would have, in their words, only a “fractional” effect on unemployment. And taking into account the NLW, the OBR forecast that employment would rise by 1.1 million by 2020.

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