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EDITIONS
Minimum wage Friday, 2 April, 1999, 19:25 GMT 20:25 UK
Wage winners and losers
Wages in the UK vary enormously. They range from the extremes of cleaners earning 1.70 an hour to SmithKline Beecham's boss Jan Leschly, who earns 406.73 an hour.

The new minimum wage cannot hope to boost wage levels anywhere near Mr Leschly's. But it should improve the salaries of the low-paid.

There are currently about 1.9m people earning below the minimum wage, according to the Low Pay Commission (LPC).

More than half of them are concentrated in seven sectors: Cleaners, sales assistants, care assistants, bar staff, catering assistants, waiters and clerks.




People who work from home and part-time will reap the most benefits from the new measures - 1.3m of them will be women.



It is also interesting to draw a comparison between low-paid and higher paid jobs, putting the minimum wage level into a broader context:



But the introduction of the minimum wage will not automatically improve the lot of low-earners and the unemployed.

Unwanted jobs

The number of job vacancies advertised in job centres has risen by 9,000 since last June to 306,000.

Minimum wage
Employment experts say the figure for available jobs is actually much higher, as it does not include those advertised by commercial agencies or local papers.

Unemployment rose by 4,300 in March to 1,294,000. There are 1.79m people looking for work but not signed up for benefit.

So there are jobs available and people who could do them, but instead they remain unemployed.

'Benefit trap' blamed

The "benefit trap" is at the root of the problem, according to Low Pay Unit Director Bharti Patel.

"While we celebrate the introduction of 3.60 as the national minimum wage, many people will still need to rely on benefit to survive," she told BBC News Online.

She said there was a major risk that crucial benefits would be lost if people left unemployment to take up low-paid work.

"The government still hasn't really dealt with the problem of the poverty trap, with many people still facing marginal tax rates of up to 80%."

Better off on benefit

"Unless the government does enough to cover these concerns, many unemployed people will ask themselves if they are better or worse off at work or on benefit, said Ms Patel.

A spokesman for the Department of Trade and Industry said: "Together with the government's tax and benefits reforms, the national minimum wage will form the cornerstone of our overall strategy to 'make work pay' and attract more people without jobs into the world of work.

"The national minimum wage at the general adult rate of 3.60 when combined with the working families tax credit and other benefits for a one earner family with two children will provide an effective wage of more than 6.60 per hour."

Links to more Minimum wage stories are at the foot of the page.


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