Living Wage: Young People

Department for Business, Energy and Industrial Strategy written question – answered on 30th May 2018.

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Photo of Faisal Rashid Faisal Rashid Labour, Warrington South

To ask the Secretary of State for Business, Energy and Industrial Strategy, if he will make an assessment of the effect on productivity of excluding under 25 year olds from receiving the National Living Wage.

Photo of Andrew Griffiths Andrew Griffiths Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

Workers under 25 are entitled to the National Minimum Wage (NMW), which is designed to ensure younger workers are fairly rewarded, while protecting the employment prospects of those workers. For younger workers, the priority in those years is to secure work and gain experience – something that has always been reflected in the NMW rate structure.

Age-related rates protect younger workers who are more vulnerable in the labour market. For example, between January to March 2018, the unemployment rate for people aged 16 to 24 was 12 per cent compared to 3 per cent for those aged 25 and over.

All of the NLW and NMW rates are recommended by the independent Low Pay Commission (LPC). The LPC is carrying out a review of the youth rate structure to see if the current structure best supports their remit. They are due to provide their advice to Government in Spring 2019.

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