National Minimum Wage

Chapter 3: Young People, Interns and Apprentices
3.66 The BIS Apprentice Pay Survey found that around 20 per cent of apprentices may have been
paid below their NMW entitlements, whether in respect of the age rates or the Apprentice
Rate. Figure 3.12 shows that hairdressing was the sector with the lowest median pay rate
and highest proportion of apprentices paid below their NMW entitlement.
Figure 3.12: Median Apprentice Pay and Apprentices Paid Below the Applicable
Minimum Wage, by Sector, GB, 2011
Business administration
Children’s care, learning and development
Construction
Customer service
Electrotechnical
Engineering
Hairdressing
Health and social care
Hospitality and catering
Retail
Team leadership and management
Other frameworks
Source: LPC estimates based on BIS Apprentice Pay Survey, GB, 2011.
Apprentices paid below the NMW (per cent)
0 5 10 15 20 25 30 35 40 45 50
0 1 2 3 4 5 6 7 8 9 10
Median gross hourly pay (£)
Apprentices paid
below the NMW (top axis)
Median gross
hourly pay (bottom axis)
3.67 The survey found that seven in ten apprentices worked for their employer before starting
their apprenticeship. But this proportion varied considerably between sectors. In the lowpaying
sectors, around 90 per cent of apprentices in retail, hospitality and social care already
worked for their current employer, and around 60 per cent did so in hairdressing and
childcare. Figure 3.13 shows that there is a marked difference in the pay distribution of those
apprentices who already worked for their employer and those who did not. This distribution is
similar if we look only at apprentices in their first year of training. Apprentices who previously
worked for their employer are more likely to be paid a higher hourly wage than those who did
not. Furthermore, 85 per cent of apprentices who previously worked for their employer
appear to have been paid at least the relevant minimum wage, a figure which falls to 69 per
cent for apprentices who were newly recruited to their employer.
3.68 Our further analysis also found that non-payment of the appropriate rate of the NMW was
more likely to occur in the second and subsequent years of training than the first. About 9 per
cent of apprentices in their first year of training appeared to be paid less than the NMW,
rising to 39 per cent for apprentices in their second year, and falling slightly to 27 per cent for
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