National Minimum Wage

Chapter 2: The Impact of the National Minimum Wage
other small and medium-sized firms and last among large firms. The fall in vacancies was of a
similar magnitude in micro, other small and medium-sized firms with large firms being least
affected. However, the growth in vacancies among small and medium-sized firms was much
stronger in the recovery compared to large firms, but they have since seen a fall in vacancies
from the middle of 2010. In contrast, the level of vacancies in large firms has been fairly
static.
Figure 2.19: Annual Change in Vacancies, by Firm Size, UK, 2002-2011
Change in number of vacancies on year earlier (per cent)
60
40
20
0
-20
-40
-60
2002 June
2002 December
2003 June
2003 December
2004 June
2004 December
2005 June
2005 December
2006 June
2006 December
2007 June
Month
Micro Other small Small Medium Large
Source: LPC estimates based on ONS data, vacancies in firms with 1-9 employees (ALY5), 10-49 employees (ALY6), 50-249 employees
(ALY7), 250-2,499 employees (ALY8) and 2,500+ employees (ALY9), monthly, seasonally adjusted, UK, 2001-2011.
Unemployment and Inactivity
2.87 We saw earlier that employment rates for many of the groups expected to be most affected
by the minimum wage have increased since its introduction. Table 2.10 shows that older
workers, ethnic minorities, disabled people and migrants have also experienced reductions or
less than average increases in their unemployment and inactivity rates since the introduction
of the minimum wage. With the exception of some ethnic minorities, these groups have also
coped well since the start of the recession and over the past year. In contrast to the rise in
inactivity rates for men, those for women have fallen since 1999, while changes in
unemployment rates were similar for both genders. Again, it is a different story for young
workers and those with no qualifications who have generally seen their unemployment and
inactivity rates rising.
2007 December
2008 June
2008 December
2009 June
2009 December
2010 June
2010 December
2011 June
2011 December
60
40
20
0
-20
-40
-60
55