National Minimum Wage

National Minimum Wage
80
Figure 3.5: Economic Activity of 16-17 Year Olds, UK, 1993-2011
Number of 16-17 year olds (thousands)
1,000
800
600
400
200
0
1993 Q1
FTE and not employed
Introduction of
the NMW
1999 Q2
FTE and employed
Introduction of
the 16-17 Year
Old Rate
2004 Q4
Quarter
Start of
recession
2008 Q1
2011 Q3
1,000
Employed only Unemployed Inactive
Source: LPC estimates based on LFS Microdata, quarterly, four-quarter moving average, UK, Q2 1992-Q3 2011.
3.24 Figure 3.6 shows that although the levels are different, the trends over time for 18-20 year
olds are broadly similar to those for 16-17 year olds. The number of 18-20 year olds in
employment fell over the period, although there was a small increase between the
introduction of the NMW in 1999 and the end of 2004. This reduction has largely been
caused by the fall in those 18-20 year olds who were in employment only (and not in FTE),
where the number fell from almost 1 million in 2004 (43.2 per cent of the population) to
736,000 in the third quarter of 2011 (30.8 per cent).
3.25 In contrast, the number of 18-20 year olds in FTE has steadily risen over the period, reaching
1.16 million by 2011 (48.6 per cent of the entire cohort). This is the first time since records
began in 1992, and probably ever, that the number of 18-20 year olds in FTE has been greater
than the number in employment.
800
600
400
200
0