Journal of the European Economic Association · 2003 · 210 citations · 15 references
Between 1993 and April 1999 the United Kingdom had no minimum wage (except in agriculture), and the residential care homes sector, with many low‑paid workers, was highly vulnerable to such legislation. The study examines the impact of the April 1999 introduction of the National Minimum Wage on wages and employment in the residential care homes sector. The authors analyze wage and employment changes in the residential care homes industry following the NMW implementation. The NMW raised wages for many care‑home workers, compressing the lower wage distribution and reducing wage inequality, while employment and hours fell slightly but modestly.
Between 1993 and April 1999 there was no minimum wage in the United Kingdom (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 employment. Our results suggest that the minimum wage raised the wages of a large number of care home 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.
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The Economic Impact of Minimum Wages in Europe
Juan J. Dolado, Françis Kramarz, Stephen Machin et al. · Economic Policy · 1996 · 268 citations
Labor Market Participation, Social Sciences, Minimum Wages +20