A Side Effect of Minimum Wages
I've never liked the policy, here's an anecdote and an illustration. And nurses.
The minimum wage was one of Tony Blair1’s favourite policies, and it generally still has broad support in Britain. That comes down to a mix of economic illiteracy, people who view it as a pay rise from the government and the fact our shareholder-value financialised mindset would pay everyone in dog biscuits if they could2.
It’s generally been one of the causes in a great number of building economic issues in Britain. There’s regular talk about how the number of people who are physically healthy enough to work but do not is continually climbing. Aside from genuine issues, one of the problem is productivity. There are, and will always be, people whose ability to work or be productive is so marginal they simply aren’t worth much money. An escalating minimum wage basically legislates them out of employment.
I can recall working for an archiving company in 2006, earning the then-minimum wage of £5.65 an hour. The company owner of that small, 20 person, company freely admitted that he used to pay £10 an hour for the IT skills required but could now get away with the legal minimum as “all temporary jobs are just coming down together”. He wasn’t really wrong, an office based, 9-5, temporary job that didn’t involve 12 hour shifts standing on a concrete floor picking and packing, or some other heavy duty factory work, was always going to find a ready supply of willing workers.
These days, I work as a nurse for “Our NHS”. As much as one of the world’s biggest employers and bureaucracies has its issues, it’s actually a lot better than the media would have you think. That doesn’t explain the weird, semi religious, cult over the NHS which pops up at various times but it’s still a reasonable answer to a difficult problem. Sadly with Britain moving towards the end of its first-world status3 and an increasingly unhealthy population we’re going to have to start having those difficult conversations4.
Not me. I don’t think male nurses ever had hats at all. We tend to get forgotten about until required.
NHS nurses now work in a banding system, starting nurses earn around £15.32 an hour. After a 3 year degree they paid for, and working full time (for free) for half of that degree. The national minimum wage is now £12.21.5
Way back when the minimum wage was introduced, in far off and sunny 19996, it was a rather tiny sounding £3.60 an hour. Nurses in the 1999 re-banding of their jobs (at a time when a degree still wasn’t required, but uniform hats had gone) were earning £6.59 an hour7.
To set inflationary questions to rest, I’ll plug the numbers into the Bank of England’s historical inflation calculator. It’s a fun thing to play with, going back to the early 13th century8.
It gives us numbers of that £3.60 being the equivalent of £6.77 today and our 90s nursing entry wage being £12.39.
It’s interesting that the wages have grown slightly above inflation, but through 2 new (worse) pension schemes and a massive increase in qualifications and skills.
The next exciting calculation we’re going to make is looking at a comparison between the minimum, and the nurse’s pay. Back in 1999, our nurse earned 1.83 times the minimum hourly wage. Now, we’re going to get 1.25 times the minimum.
Things like stress, and opportunity cost are real issues. Opportunity cost is one of those things everyone can instinctively feel - it’s essentially what else you miss out on by choosing one option. You can’t spend the same time, money or youth twice.
We’re working in an economy that’s designed to gradually put everyone into the minimum, or hair-splitting increments over it. And then our genius tier politicians wonder why people don’t work and they perpetually have recruitment crises in some industries. Either this is what they wanted, or they’re morons.
This man did more to damage Britain than any individual in the previous 2000 years. Bravo.
Indentured servitude and the Company Store are coming back soon
Well, it is, isn’t it?
Like all difficult healthcare related questions, this will be done too late.
Look up “Agenda for Change” pay if you don’t believe me.
Historical rates here https://www.nibusinessinfo.co.uk/content/national-minimum-wage-previous-rates
From an ancient BBC news article here http://news.bbc.co.uk/1/hi/health/background_briefings/nhs_pay_99/265087.stm I was still in school then, not being attacked by delirious and psychotic patients.
Go on, figure out the value of your house in the 16th century. Genuinely one of the more entertaining quirks of the Bank of England
I'll bring the case for the paranoid. It's a plan to turn us all into welfare serfs.
I live in Westminster (the not-nice part). Were I to go on benefits, I would receive £1,836.16 pm. That's for a single person in a one-bedroom flat. £440.16 cash per month, the rest for rent. Why should I then take a minimum wage job? It would be a strange choice as I'd spend a year working for less than £500, which would not cover half the cost of taking a London bus to and from work for the year. Work might be good for the soul, so there is that, but it's a financial loss.
It would appear that the reason people do not / will not "get off benefits" is that they're not idiots. Nor, for that matter, are the politicians. Having a "universal income" / dole for the masses suits them just fine. Proles rarely vote against the hand that feeds them.
It almost seems to me as if Britain is slowly moving in the direction of communism/slavery.
"You will do what we tell you to do, or you will starve." You'll starve anyway, they won't care.