Minimum wage earners face struggle to climb career ladder

Thinktank finds that many people – mainly women – are getting stuck on the minimum wage

Women, part-time workers and those in wholesale and retail roles are most likely to remain on the minimum wage. Photograph: Ricky John Molloy/Getty Images
Nearly a quarter of those on the national minimum wage have been stuck on the rate for at least five years, suggesting the minimum wage is danger of becoming a permanent rate for some, rather than a floor as first envisaged by its founders.

The findings by the Resolution Foundation thinktank are part of a picture being developed of the kind of people – mainly women – who are finding the minimum wage turns into a job for life rather than the first rung on the career ladder.

There are also signs that more people are being clustered close to the minimum wage. A new briefing paper by the thinktank says that 1.9 million people (7.6% of all employees) earned within 25p of the minimum wage in 2012, twice the proportion in 2002. The wage rose to £6.31 this month, but all three main parties are looking at ways in which the rate can be lifted over time or in specific sectors. The latest findings will help those pressing the case for reform.

The Resolution Foundation suggests that 320,000 people have been in the UK’s minimum wage labour market for at least five years, only ever having held minimum wage jobs in that period. This is equivalent to 17% of all employees who are paid at the minimum rate.

Viewed over a longer time period, 140,000 people or 7% of all current minimum wage earners have been in the labour market for at least 10 years. About 90,000 people have been earning close to the legal minimum since the policy was introduced in 2002. This means that 5% of minimum wage earners have been unable to move above the first rung of the earnings ladder in the preceding 13 years.

The report also shows that 73% of all those who have only held minimum wage jobs in the past five years are women and suggests the crucial fork in the road comes when someone reaches their mid thirties. If they fail to break out of low pay at this point, they may not be able to do so later.

The report concludes: “For parts of the UK’s minimum wage workforce – in particular women, part-time workers and those who ended up or remained in wholesale and retail roles – the minimum wage has been a reality for an extended period of time”.

guardian 26/10/2013 Patrick Wintour

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