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Osborne's new minimum wage will attract EU migrants, says thinktank Osborne's new minimum wage will attract EU migrants, says thinktank
(34 minutes later)
The new national living wage (NLW) is likely to make the UK more attractive to EU migrants, according to a respected thinktank. The new national living wage (NLW) is likely to make the UK more attractive to EU migrants, according to a respected thinktank. The budget announcement, made by the chancellor, George Osborne, on Wednesday, will make the UK minimum wage one of the highest in Europe. The NLW will be set at 60% of UK median earnings for anyone aged over 25, a change that is likely to improve the wages of 2.75 million people.
The budget announcement, made by the chancellor George Osborne on Wednesday, will make the UK minimum wage one of the highest in Europe. The NLW will be set at 60% of UK median earnings for anyone aged over 25, a change that is likely to improve the wages of 2.75 million people. Dr Jonathan Portes, director of the National Institute of Economic and Social Research, said the move will be of benefit to EU migrants. “Wage rates – in particular the level of the minimum wage – almost certainly do impact migration decisions,” he said.
Dr Jonathan Portes, director of the National Institute of Economic and Social Research, said the move will be of benefit to EU migrants. “Wage rates – in particular the level of the minimum wage – almost certainly do impact migration decisions” he said.
Wage rates – in particular the level of the minimum wage – almost certainly do impact migration decisionsWage rates – in particular the level of the minimum wage – almost certainly do impact migration decisions
“Employers will have a significant incentive to employ the under 25s who will be considerably cheaper so employers may choose to hire relatively more under 25s.” He added this may provide a boost to the relative employment prospects of EU migrants.“Employers will have a significant incentive to employ the under 25s who will be considerably cheaper so employers may choose to hire relatively more under 25s.” He added this may provide a boost to the relative employment prospects of EU migrants.
Downing Street has denied that the big rise in the minimum wage will make the UK labour market more attractive to EU migrants.Downing Street has denied that the big rise in the minimum wage will make the UK labour market more attractive to EU migrants.
Downing Street said: “There are many different wage rates across Europe. Some other countries pay considerably higher wage rates than the UK.”Downing Street said: “There are many different wage rates across Europe. Some other countries pay considerably higher wage rates than the UK.”
The Treasury said “it was confident the increase in the minimum wage will not have any impact on migration flows”.The Treasury said “it was confident the increase in the minimum wage will not have any impact on migration flows”.
A Ukip spokesman said the chancellor faced a Hobson’s choice; if he does something to make life life easier for low-paid workers in this country inevitably in so doing, given the relatively low wage rates in the rest of Europe, he makes this country an even more attractive place to work.A Ukip spokesman said the chancellor faced a Hobson’s choice; if he does something to make life life easier for low-paid workers in this country inevitably in so doing, given the relatively low wage rates in the rest of Europe, he makes this country an even more attractive place to work.
“Ukip has always thought the in-work tax credits are marginal in decisions about whether to come here. We have a deeper philosophical disagreement that we cannot decide who comes to his country,” the spokesman said.“Ukip has always thought the in-work tax credits are marginal in decisions about whether to come here. We have a deeper philosophical disagreement that we cannot decide who comes to his country,” the spokesman said.
A table produced by the Office for Budget Responsibility alongside the budget shows the government plan to lift the national living wage for those aged over 25 to 60% of median earnings would put the minimum wage right at the top of table in terms of relative generosity – well ahead of most eastern EU nations including Poland and Romania.A table produced by the Office for Budget Responsibility alongside the budget shows the government plan to lift the national living wage for those aged over 25 to 60% of median earnings would put the minimum wage right at the top of table in terms of relative generosity – well ahead of most eastern EU nations including Poland and Romania.
The real-terms relative value of UK wages will be even higher, and there will be nothing under EU law to prevent low-skilled workers coming to the UK benefit from a higher minimum wage.The real-terms relative value of UK wages will be even higher, and there will be nothing under EU law to prevent low-skilled workers coming to the UK benefit from a higher minimum wage.
OECD minimum wage statistics stop in 2013 but looking at the trend in minimum wage rate rises over recent years, the hike to £9 an hour in 2020 planned in the UK is likely to put UK wage rates close to the hourly level of France and be more than double Spain, and most eastern European countries.OECD minimum wage statistics stop in 2013 but looking at the trend in minimum wage rate rises over recent years, the hike to £9 an hour in 2020 planned in the UK is likely to put UK wage rates close to the hourly level of France and be more than double Spain, and most eastern European countries.