AIBU to not understand the fuss over minimum wage increases

[RaspberryYogurts]

I work full time and earn just a bit more than minimum wage, and I keep coming across comments from people saying they think it’s great that the rates are increasing. I don’t get it. It’s the same thing every year. Sure, our pay will rise, but so will everything else. So how are we actually going to be better off?

I worked it out last year, and I’m sure it was only a £20-£25 difference as council tax, water rates, etc, also went up. I’m grateful that I can afford a roof over my head and food on the table, as some people don’t even have that, but is this really suppose to change our lives / make things easier? Am I missing something here??

My point on this is the difference between NMW and skilled jobs. Take newly qualified nurses and teachers for eg. Why rack up £££ debt to be on barely anything more than a supermarket worker? Maybe they have more earning power eventually but take away the debt and the hassle and it’s barely worth it.

Congratulations on being £25 better off. Most people working aren’t.

Well if everything went up and NMW didn't surely people would be worse off?

It will be more difficult for 18-20 year olds to get work now with the large rise in their minimum wage.

Oh, for sure! It’s just an endless cycle though isn’t it. We get more, but it just goes into someone else’s pockets, so we never really see any improvement.

This is the argument against a minimum wage. Increase cost to business and they have to increase prices.

I still think it's broadly a good thing though.

It's an absolute killer for small business, especially hospitality. So it backfires, because these end up going out of business. And then there are no jobs.

To be fair, I said in my original post that I appreciate having a home and food, but it’s not a race to the bottom. £25 is hardly billions lol

Nope, it keeps people treading water and the people above them who don’t get the same increase on their wage feel a little bit poorer (I’m not talking about those earning loads more, those who were earning a £1 more might now only be getting 50p more per hour above minimum wage wage).

I also found it pushed me above the threshold for free prescriptions/ eye tests etc even though in real terms I was no better off after other increases.

Min wage increases only improve lives if cost of living doesn’t rise higher, otherwise it keeps things exactly the same for them.

You are not wrong. Some university tutors get paid £17ph. And that's zero hours, so no pay for setting up the classroom, testing the tech, photocopying, being asked questions afterwards. And students wonder why their tutors phone it in.

100%

It's to stop people being worse off rather than to make people better off. If you want to be better off, you need to find work with more responsibility that pays better.

For example, if you start life as a cashier in Tesco when you're 20 and finish your career at 67 as a cashier in Tesco, you are still doing the same job. So the aim is to keep a cashier's salary at the same level, taking inflation into consideration.

You can't expect to do an identical job year on year and expect to be paid more as you are not giving more.

It's the same argument that you can't expect everyone to earn well. Or they would be nobody to scan your shopping or clean the childrens schools. It works both ways!

Don't be ridiculous, of course it's worth it! You've contradicted yourself there - you've admitted that the minute you qualify, you instantly have better earning power... and then said it's not worth it! Everyone starts at the bottom whatever profession you're in. You can't expect to earn mega-bucks from day 1 just because you have a qualification.

It feels like we’ve reached a point where minimum wage increases are starting to have some unintended consequences. As the minimum wage goes up, it pushes up wider costs in the economy, which then feeds into inflation. That means the people on minimum wage end up facing higher living costs, so they’re not necessarily any better off in real terms.

At the same time, higher wage costs incentivise employers to offshore lower skilled roles, automate them, or reduce headcount, which ultimately reduces the number of available jobs. I don’t think it’s wrong to ensure people are paid a basic, livable wage but other factors need to be taken into consideration to ensure the increases benefit workers and the economy. The gap between unskilled roles and graduate level or more skilled jobs has narrowed quite significantly so less incentive to train or take on extra responsibilities. I think we do need a better grip on welfare and government spending which could reduce tax rates to give low paid workers more take home pay.

It's a floor that your employer cannot pay beneath. It's supposed to stop your life getting worse, not make it radically better.

Yes it's only £25. But sometimes in life you get something or nothing, and something is generally better.

A lot of inflation is fuelled by food and energy becoming more expensive. International factors are driving a lot of this, not least increasing affluence in both India and China and crop failures closer to home due to a warming climate in Mediterranean countries. Minimum wage increases will fuel increases in the cost of services that rely on low pay workers (hospitality and social care, possibly hair and beauty) but it has a lesser effect on the cost of food and energy.

@TangoWhiskeyAlphaTango1 because being a shelf stacker requires a certain personality .

I read once being in work that is monotonous and boring is as stressful as being a fighter pilot. So doing a job that's requiring skill maybe more emotionally and mentally rewarding no matter what the parity is between shelf stacker end nurse.

I do get your point though. .
Unfortunatly jobs will shrink and our young will face a bleak landscape graduate or not..as jobs contract.

Because employers don't have a bottomless pot of money so by raising NMW they have to make cute elsewhere eg number of staff/redundancies etc. This especially impacts small business owners eg nurseries/retail etc. So fewer entry level jobs etc.
It also drags entry level jobs closer to skilled jobs so disincentivses upskilling of employees.

It has a knock on effect further up the chain too because people on middling wages do not get a government mandated raise. It disincentives ambition and rewards underemployment.

Edit: Linked to the wrong post and basically just repeated your post @twistyizzy 🤣 sorry

Yes agree.

It means someone employed on previous NMW for 30 hours per week could now be employed for 25 hours pw on the new NMW.

NMW increases make it more worthwhile for employers to invest in automation to reduce headcount.

This is true, but we will always need ‘unskilled’ workers to do these jobs. For some, this is the most they can manage. They don’t deserve to be paid a wage upon which they struggle.

What you have struck upon here is the intractable problem of productivity. Increases in wages do not make people richer unless we can be more productive, otherwise it’s just inflationary.

I guess the thinking is a rising tide raises all boats but in the case of NMW a rising tide means the rest of the boats start springing leaks …