National Minimum Wage

National Minimum Wage
2.43 Around 47 per cent of jobs in the cleaning industry, 42 per cent in hospitality, 35 per cent in
hairdressing and 33 per cent in childcare were paid less than £6.50 an hour in April 2011,
while fewer than 17 per cent were paid less than £6.50 an hour in food processing,
agriculture, security and office work. Around 19 per cent of jobs in micro firms were paid less
than £6.50 an hour, compared with fewer than 9 per cent in large firms. This suggests that
differentials in many low-paying industries and in micro firms are already quite narrow.
2.44 There are also differences by worker characteristic. We can see from Figure 2.14 that certain
groups of workers are more likely to be low-paid. Workers with no qualifications were nearly
three times more likely to be paid below the forthcoming minimum wage than the overall
working age population.
2.45 Again there is substantial variation among ethnic groups. Around 29 per cent of Bangladeshi
workers were paid below the forthcoming minimum wage in April 2011, and 40 per cent
were paid below £6.50. Only 8 per cent of black workers were paid below the forthcoming
minimum wage, and they were less likely to be paid below £6.50 than the overall working
population (11 per cent compared with 15 per cent).
40
Figure 2.14: Proportion of Jobs Held by Those Aged 21 and Over, by Pay Band and
Groups of Workers, UK, 2011
All
Disabled people
Women
Migrant workers
Unqualified
All ethnic minorities
of which:
Black
Indian
Pakistani
Other non-white
Bangladeshi
0 5 10 15 20 25 30 35 40 45
0 5 10 15 20 25 30 35 40 45
Jobs held by workers aged 21 and over (per cent)
Paid at or
below £5.93
Paid between
£5.93 and £6.08
Paid between
£6.08 and £6.50
Source: LPC estimates based on LFS Microdata, income weights, quarterly, not seasonally adjusted, UK, Q2 2011.
Note: This analysis covers both main and second jobs held by employees.
2.46 When we rank employees by their earnings, split them into 100 equally sized groups
(percentiles), and order them from the lowest paid to the highest paid, Figure 2.15 shows
that before the introduction of the minimum wage those at the lowest end of the hourly
earnings distribution had the lowest wage rises. Between 1992 and 1997, those in the