Minimum Wage Policy

HC Deb 04 November 1986 vol 103 cc376-7W

Mr. Galley

asked the Paymaster General what assessment he has made of the employment consequences of a minimum wage policy.

Mr. Lee

Using the earnings information from the 1985 new earnings survey, we estimate that a national minimum wage of £80 per week (the level implied in the TUC/Labour party document "Low Pay: Policies and Priorities") could result in job losses ranging between 60,000 and 600,000 over a period of time. This large range reflects uncertainty about the effect of a minimum wage on the structure of earnings, and the extent to which higher paid workers would be able to secure compensating wage increases to restore previous differentials.