The Living Wage: it’s a nice name but is there a sting?
It’s all about optics. Similar to the Low Wage Commission. Recommending a 50c increase on foot of a half-assed report.
No matter the evidence, the outcome was predetermined by the committee make-up.
And on the other hand Fine Gael are promising employers that they only have to pay wages up to a certain amount and the taxpayers will top it up for them regardless of the profits being made!
When satire becomes reality what have we left?
The logic of this analysis escapes me. Surely if most households in poverty are on beneefits than increasing the minimum wage will enable them to escape poverty by getting a job.
Or is the ESRI proposing that we increase social welfare yet further which would address poverty sure, but remove any incentive to work.
Some argue that increasing minimum wage reduces employment.
I think it depends on the relative strengths of welfare traps vs marginal demand for cheap labour.
Presumably they mean that people already on the minimum wage are not those in poverty, and those on social welfare are unlikely to move to minimum wage jobs?
Also IIRC “poverty” in some of these reports is described in terms of quartiles of income distribution or some such bolloxology (rather than absolutely), so the number of people in “poverty” never changes.
I’d quite like to see the lowest tax credit replaced with a universal income payment, a bit like child benefit.
Social welfare payments would be reduced accordingly and the lower rate tax would be paid on all income from zero up to whatever the current cut off is.
I’d abolish student grants in connection to the measure too.
It’d remove a lot of faffing with emergency tax and the like.
It should also give scope to reduce the rules around casual working and social welfare payments.
Relative poverty leaves something for the next government to fix
“Relative poverty” is defined as those people living below a certain percentage of the median income (I think 60% of it), so it’s more a measure of inequality than deprivation. Under certain unlikely circumstances, poverty being can vary from being non-existent in both absolute and relative terms (a perfect delta function of the very rich) through undefined in relative terms, but very real in absolute terms (a bimodal distribution of two delta functions, where 50% of the population are equally stinking rich and 50% equally hard up, but maybe not quite destitute) to non existent in relative, but universal in absolute terms (a delta function of the dirt poor).
“Relative Deprivation” or even just “financial inequality” would maybe be much more sensible terms.
Mantissa is right.
The only way poverty is reduced is if the income distribution gets more equal.
The problem is that this generally happens only at times of very rapid growth (see Brazil in last 15 years)
Otherwise income distributions are remarkably resistant to tinkering though his doesn’t stop the great and the good trying.
Today’s number involved +1% for 3% of the workforce.
Came across this today - maybe it has been mentioned here before:
Scotland has a ‘Business Pledge’ which is basically a voluntary code for companies to sign up to.
The main commitment is to pay the living wage and then you choose at least two of the others (e.g. not using zero hours contracts, paying bills on time, gender balance and so on).
They say it’s not mandatory and it won’t influence your chances of winning public contracts and other funding. Maybe they could add some strings if they felt like it but I suppose they are doing whatever everyone has to do: offer incentives in return for FDI.
Anyway, it came my way via a small-ish medtech company in Scotland (with a big global parent) who signed up but found the living wage bit extremely hard to live up to. You don’t have to pay it to interns or apprentices but it makes the bottom-of-the-ladder office or warehouse jobs fairly expensive.
Cool - add it to the pledge: I promise not to use super-efficient robots
A study of minimum wage employment in Ireland: the role of worker, household and job characteristics
“This study provides valuable information about factors that increase the probability of earning minimum wage in Ireland. It also identifies who would be affected by changes to minimum wage rates and if such changes would be an efficient way to combat poverty. However, our analysis confirms previous assessments by both the Irish Low Pay Commission and our ESRI colleagues Logue and Callan – as a policy tool, the NMW will have only a limited effect on reducing poverty.”
NMW workers are often second or even third earners in a household.
The Government this week announced that an increase in the hourly rate of the minimum wage to €10.10, as recommended earlier this year by the Low Pay Commission, will come into effect at the beginning of February. This will be several weeks behind the usual date of the rise due to uncertainty over Brexit.
However Ictu said that the Living Wage Technical Group had earlier this year calculated the hourly pay required by a full-time worker without children to afford a socially acceptable standard of living in 2019 at €12.30, an increase of 40c per hour on 2018.
Comrades on the left of me, comrades on the right, here I am stuck in the middle of the Zoo…