Whose on the Minimum Wage?
Posted on July 02, 2015 by Micheál Collins
A new NERI research paper estimates the number of workers on the minimum wage and further profiles these workers by gender, by the sector they work in and by their employment status (full-time, part-time, permanent, temporary etc). The data also allows an examination of the household/family circumstances of workers on the Minimum Wage.
The key findings from the paper are:
- There are approximately 75,000 workers on the minimum wage
- Most are women (65%)
- Most are aged in their 20s and 30s and large proportions of these employees work in sectors such as accommodation and food and wholesale and retail.
- Relative to employees in general, minimum wage workers are more likely to be:
- on temporary contracts,
- working less than 20 hours per week,
- working part-time and
- be in the private sector.
- Overall, those on the minimum wage represent 5.6% of all employees, with 32,250 working full-time on the minimum wage.
Linking earnings data to household income and living standards data, the research also identifies that employees on the minimum wage, while not necessarily living in poverty, tend to struggle financially. Of those employees on the minimum wage:
- one-third had difficulty making ends meet,
- one-fifth had gone into debt over the past year for ordinary living expenses and
- almost one-third were experiencing deprivation.
- In all cases the prevalence of these situations was greater for those on the minimum wage than for employees in general.
A Minimum Wage of €5.58 per hour (IR£4.40) was introduced for experienced adult workers in Ireland under the National Minimum Wage Act 2000. Since then the rate has changed on eight occasions before reaching €8.65 in July 2007. In February 2011 the rate was reduced to €7.65 and subsequently restored to its current level (€8.65) in July 2011.
The recently established Low Pay Commission is considering the appropriateness of a further revision to the rate and is due to report to Government in July 2015.
Establishing a profile of the lowest paid workers in society facilitates a better understanding of the labour market and the socio-economic context of current considerations of changes to the minimum wage.
The reference to the paper is:
Collins, M.L. (2015), ‘A Profile of Those on the Minimum Wage’ NERI Working Paper, 2015/ No. 27. Dublin, The Nevin Economic Research Institute.
Slides from the NERI Seminar (July 1st) are here