MSE News: Minimum wage up by 12p per hour from October

AP007

sidsnot wrote: »

What is not mentioned by the op stating jsa pays £70+ a week is that it also includes Housing and council tax benefit , a person working 40 hours a week on minimum wage has to pay rent and council tax, I worked for 4 months on minimum wage last year before finding better work , 40 hours a week slogging it out on nights for just over £30 a week more than if I was on JSA , why people would rather claim benefits for doing nothing isn't really hard to see is it?

And again I say for those who ONLY get JSA (I am one) I'd work for NMW when I was on £14 per hour at my last job as its a lot more than £71.70 a week take home.

Takeaway_Addict

Affynity wrote: »

I'm not sure why my original post caused discord with certain people.
Here's the natural flow of below-inflation wage rises:

Disposable income ---> Subsistence only ---> Arrears

While you may see it as crippling to small and medium businesses, you've also got to remember that when you reduce disposable income, you limit peoples' engagement with products and services, which in turn, damages small to medium businesses, many of whom cannot match the discounts of their large rivals.
In fact, as money becomes less available, ALL spending will decrease, so even the biggest corporations will start to see losses.

So while boosting your employees' wages may be a difficult pill to swallow, it must inevitably be swallowed.

That's a fair point if costs stayed the same but put wages up the employers have to either cut costs in other areas or start to look to increase the revenue they produce which means increase in cost of products etc.

Ultimately putting the wages up by 5.6% just like that is likely to be to sharp a jump for employers to cope with IMO.

2% is fair and right considering most wages are still staying the same or going up by less.

Butterfly_Brain

Whoopie do. It won't cover food, water, gas and electricity hikes or bedroom tax will it

Affynity

sidsnot wrote: »

What is not mentioned by the op stating jsa pays £70+ a week is that it also includes Housing and council tax benefit , a person working 40 hours a week on minimum wage has to pay rent and council tax, I worked for 4 months on minimum wage last year before finding better work , 40 hours a week slogging it out on nights for just over £30 a week more than if I was on JSA , why people would rather claim benefits for doing nothing isn't really hard to see is it?

Also consider the 1% benefits increase cap:

10% of £71 = £7.10
1% of £71 = £0.71 (71p)

The actual increased, capped sum is £71.70 and not £71.71
While I'm sure the coalition government might consider penny-pinching (hypocritically) low, they need to remember that there are 1.54 million people claiming jobseeker's allowance (JSA) who have lost a penny.
That equates to £15,400 a week or £800,800 per year.
Given that the maximum annual cost for paying JSA is £3728.40, you could pay for 4 whole, annual bills with the money the government saves each week.

Now, maybe what we should be asking ourselves is, where is this money going? £800,800 is hardly a monster sum in budget terms, but given that the government recently axed the new jobs grant, that helped those moving from unemployment to employment meet the first month's cost of the new job, there is a case that available resources are falling into an unreported abyss.

If I had to guess where the money was going. I'd say it goes back into the Departmental budget and gets subsequently wasted on the Welfare to Work Programme, or whatever barely-legal schemes the Secretary of State can think up.

RE: Takeaway_Addict

Isn't what you described simply an element of capitalism, anyway?
When you pursue profits, it's typically the human costs that are reduced anyway.
I will agree with you that meeting a fair wage at the drop of a hat is likely to cause most businesses to implode, but this is where government has to start moving away from the neoliberal nightmare dreamt up by the late Baroness Thatcher, and start plugging those potholes of inefficiency in private sector businesses.
There's plenty of capital and taxes that have not been accounted for or paid for. The reason the government don't use emergency legislation, like they did for the Back to Work Schemes Bill (2013), is because they're just as culpable for tax avoidance as any international company that cherry picks where it registers itself for tax.

vekma

MW should be nearly £8 now, and they wonder why all immigrants take MW jobs !!!!!!! joke this country, the people who set MW should be forced to live on it for a month before deciding it !

dori2o

Had the NMW been index linked when it was first brought in then the NMW would easily be £8+ now.

What both ther Labour and Tory government don't seem to understand is that the less you pay the more benefits a person is entitled to claim.

The Government could easily increase the NMW to at least £8per hour without hurting employers. The Government would be in at least a position of status quo if the increased NMW, abolished employers NIC's and reduced CT (as is already planned). The savings in WTC would more than pay for the loss of employers NIC's and CT, whilst the saving of those would more than pay for the increase in salaries for the employers.

The way to come out of a recession is to stimulate growth, part of that growth has to come from consumer confidence, and that confidence has to come from having the money in your pocket to make purchases.

Affynity

A good start would be to reduce VAT. It is another tax on the poor.
Given the harsh economic climate, it probably would be best, in the absence of a living wage (although in conjunction, would be best) to bring VAT down to the legal EU minimum of 15%.

It's much like the dreaded poll tax; A fixed-cost naturally involves spending a larger proportion of your wealth, if your wealth is small.

The problem with this administration is they rely purely on propaganda to stir up support for their ill-conceived economic strategies.
That's one of our biggest failings as a nation. When times are hard, we buy into spin and look downwards with scorn, when really, if we looked up, we would see a cosy collective that shows no sign of economic hardship.

tahrey

Rosemary7391 wrote: »

Surely a living wage depends on how much you spend on living? As a single person, I could happily maintain my current standard of living on 20 hours a week at minimum wage. A full time job on minimum wage would feel like luxury after being a student.

Re-he-heeaalllly ... want to break that down for us and show us exactly how? £125 a week, or thereabouts, aka £540 pcm ... that literally wouldn't cover all of my monthly unavoidables (housing, energy, water, council tax, low-end phone connection, etc), for a sub-50sqm flat, in a faded-glory suburb of Birmingham... BEFORE we get to things like food, entertainment (including Sky/cable if you have it), transport and other discretionary or unexpected spends. It'd be alright if I could find ten quid or so to shed from somewhere - probably cut one of the insurance policies? - but I'd still be starving, bored, and immobile. In the latter case that means I wouldn't any longer be able to get to work anyway, unless it was within walking distance (or a ride of an already-owned bicycle ... until it's inevitably stolen).

So, what's your strategy for working through that sticky issue of part time minimum wage providing negative disposable income?

Oddly, it sounds like 40 hours a week would ALMOST match my current take-home pay, but that is of course without considering tax, national insurance, pension contributions, student loan repayments...

I suppose the solution would be either to stop being nobby no-mates singleton (a liiiittle difficult when you're a/ no longer a student, b/ not in a financial position to really go out and play the scene, c/ they find out you're only doing it as an homage to "Spaced"), or to take on a lodger, which really doesn't sit well with either the limited overall floor space or the fact that the "guest bedroom" is actually a home office/study with a single bed crammed along one side of it, and there's literally nowhere else (not in the "main" bedroom, not in the lounge, not in the kitchen or bathroom or minimalist submarine-style corridors) to set up a replacement. Nor the idea that I moved out of my parents' place for a bit of god damned privacy after being stuck there for almost eight solid years after graduating. It's not really possible to downgrade the accomodation costs (I am actually mortgaging; there probably isn't anywhere in the whole of the city that can be rented for the same monthly cost that isn't a bedsit), and I'm already doing my best to minimise the other monthlies.

tahrey

Rylynn wrote: »

Yes but is that if you live at home? with parents I mean? and belive me I know that is very low money to live on.

I spent time both working and sometimes on the dole whilst "living at home" and paying a peppercorn monthly rent ... but it's not like I didn't still have other costs to cover, and I can tell you now that it was still very much more worth my while going out and working 40+ hours a week on NMW than sitting at home watching Jeremy Kyle and signing on once a fortnight.

Maybe the real terms backsliding thanks to inflation has altered that now, but I wasn't eligible for ANY other benefit, and there's no rules over what I could have been charged to avoid being kicked out (luckily it stayed sensible so I could save for a deposit). When the outgoings are sort of fixed, increasing income by even 50% makes a huge difference. 100% (with the odd bit of overtime), even more so. £71.70 is the equivalent of just £1.79 an hour. It's !!!!!!-all. The £30 difference you saw would have been a good 42%, or the equivalent of doing an extra full day's work at double time with an attendance bonus, if the JSA was actually an hourly paid job. (Or in other words, the same as being paid for 7-and-a-bit days each week, instead of 5). I certainly wouldn't have sniffed at that, I pulled consequtive double shifts at a hotel-and-nightclub-bar job for similarly proportioned sweeteners.

sammyjammy

Rylynn wrote: »

Yes but is that if you live at home? with parents I mean? and belive me I know that is very low money to live on.

Its not just for young singles living at home, it could be someone with a mortgage in the 13 weeks before they might be eligible for SMI.