London should have a separate, higher minimum wage

Over the last decade and a half, the difference in pay between the lowest paid decile of workers in London with that of the rest of the country has shrunk. This means we should consider introducing a higher minimum wage in London, argues Kitty Ussher. Not only will this not jeopardise jobs in the Capital, it would also benefit the Treasury and those in the hardest situations

Pay progression: understanding the barriers for the lowest paid

For many years now government welfare policy has focused on getting lower-skilled people into work, rather than on how to support low-paid people to raise their incomes in work. This report, produced in a collaboration between the CIPD and John Lewis Partnership, aims to uncover the experiences of employees on the lowest rates of pay and understand the contributing factors for an individual becoming ‘stuck’ on low pay. Tooley Street Research conducted the research and wrote the report. The research was in two parts: quantitative analysis to find out about the household characteristics and attitudes of low-paid workers and what determines their ability over time to earn higher pay rates; and focus groups with people who had been earning at, or up to 20% above, the minimum wage in recent years, to explore the barriers they face, ideas for overcoming them, and what these workers want from their working lives. The report draws out implications from the research for government and employers. The research found that 64% of those on low pay are women. There is also a strong correlation between age and being stuck on low pay, with the chances of escaping low pay becoming less likely the older you become. ‘Politicians concerned about the cost of living talk about the need to raise the minimum wage, while ignoring the fact that even a large rise in the statutory minimum will not alter the socio-economic position in society of those who are paid it.

Wealth of our nation: rethinking policies for wealth distribution

This paper explores the implications for public policy from the new Office of National Statistics (ONS) data source on wealth distribution in Britain, and what we know about future trends in savings, longevity, property prices and inheritance. The case for having a greater policy emphasis on wealth – as opposed to simply focussing on income – is that a household’s wealth at a given point in time is often a better indicator of its economic wellbeing. The ONS has now made this point explicitly, stating in July 2014, that “it is important to consider both wealth and income when assessing the economic well-being of households”. Yet the policy implications are under-explored. Using the relatively recent data source the paper describes the current distribution of assets in Britain. It then explores how this might be expected to change in future years given what we know about longevity, inheritance patterns and other demographic and policy changes. Finally we draw out implications for the public policy debate focussing primarily on intergenerational transfers including inheritance, as well as issues relating to housing and consumer debt