I personally don’t understand how the government thinks paying youths only £3.68 per hour is reasonable, let alone freezing it again for a second year at this decumbent rate. The argument against the raise is that it would lead to less youths being employed and thus not assist the individual or the economy in the long term.
What the government is considering is whether increasing the rate slightly is more beneficial to the individual or whether freezing and allowing more employment is better for the economy.
However, the government has yet to release any statistics from last year showing whether employment rates actually did increase for youths following last year’s freeze. Should the rate be frozen without any clear evidence of actual help to the economy? All we ever hear in the news is doom and gloom of increasing unemployment or funding cuts to activities & services.
In a world where everyone is suppose to be equal, then why are there different rates payable to different aged people; with our elders earning at least 68% more than us for potentially the same work, just because they’re older. But that’s another discussion, let’s get the minimum wage raised for youths after last year’s freeze, at least to meet the rate of inflation – so youths can save for rising university fees or even feed themselves.
Many argue that the minimum wage should also be based upon geographical factors – as the cost of living in London compared to Birmingham is 52% more, considering the aforementioned is a capital city and the latter being iconic and the second city of England.
For example, two people working full time at minimum wage and a similar lifestyle would have different amounts of disposable income with the Londoner having only £6750 disposable income compared to a similar person from Birmingham having £8000, nearly 20% more. Imagine what the difference is then between smaller cities compared to London – meaning these rural citizens will have more disposable income to invest into the economy as well as less debt in the future.
The decision won’t be made until February next year, but John Wastnage, a policy adviser at the British Chamber of Commerce, was quoted as saying: “We would be against raising the rate for young people and apprentices.”
This shows that employers that are represented by BCC are against a raise, but is it for the right reason – to stop raising costs or because they want to employ more people? I doubt it’s the latter for the majority of businesses.