Arguments for and Against the Minimum Wage in the Uk

Arguments for and against the National Minimum Wage (NMW) in the UK: stop employees being taken advantage of by being paid unfair wages by their employers. set a standard of the minimum worth of a worker. This benchmark was set so that employers would be unable to hire any staff for less than the suggested hourly rate. reduce pay differentials between genders. What is the new minimum wage?: In October 2009, the NMW for workers increased from:  £5.73 to  £5.80 per hour - aged 22 years and older  £4.77 to  £4.83 per hour - aged 18 to 21 years  £3.53 to  £3.57 an hour - aged 16 and 17 years As of October 2010, the adult minimum rate will start from 21 years. Who qualifies for the†¦show more content†¦This drop in demand then results in an oversupply of goods from the producer, who is then forced to reduce his supply to the new demand level, or goods may sit on the shelf. E2 represents the new Equilibrium level between supply and demand. If the good was perisha ble and the supplier did not adjust his supply, there would be a lot of wastage. Not everybody qualifies: Those who are exempt from receiving the NMW include; Apprentices under 19 years of age, and apprentices 19 years or older in their first year of their apprenticeship. Students on a work placement, forming part of a higher- or further education course, where the placement is for less than one year. The self-employed Those on a Department for Workers and Pensions back-to-work scheme The Recession: A recession is characterised by a period of at least two consecutive quarters of negative growth. During a recession, demand and supply of goods and services in the economy contracts. The UK economy contracted by 1.5% in the last quarter of 2008 and the Gross Domestic Product experienced its biggest fall since the second quarter of 1980 (Kowelle 2009). This is the first time since the inception of the NMW that employment has fallen. Unemployment is rapidly on the increase. A redu ction in output means that the need for labour is reduced. In the early stages of a recession, companies tend to cut back on employee hours, rather than making workers redundant. IfShow MoreRelatedDemand Supply , Examine the Argument in Favour Against Minimum Wage Law in Uk1415 Words   |  6 PagesAssignment: A * (Using Demand Supply: examine the arguments in favour against minimum wage law in UK*) * *Total words: 1,402 Demand It refers to the willingness and ability of buyers to purchase goods and services at different prices. Supply It refers to the willingness and ability of sellers to provide goods and services for sale at different prices What* *is minimum wage? A minimum wage is the lowest monthly, daily or hourly that employersRead MoreThe Argument Against the National Minimum Wage Essay883 Words   |  4 Pages The national minimum wage was introduced in the UK in April 1999 by the Labour government. 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