Although the government deserves a degree of credit for seeing off calls from business leaders to freeze the minimum wage, by increasing it to £6.31 - meagre increase of twelve pence - it has yet again failed to ensure the minimum wage is above inflation for the third year running.
Although the government deserves a degree of credit for seeing off calls from business leaders to freeze the minimum wage, by increasing it to £6.31 – meagre increase of twelve pence – it has yet again failed to ensure the minimum wage is above inflation for the third year running.
The graph below shows the percentage change in the minimum wage compared to CPI inflation since Tony Blair introduced minimum wage legislation in 1999.
For the first nine years of its existence the minimum wage soared above inflation levels, peaking at 9.6 per cent above inflation in 2001.
However, inflation levels surpassed the minimum wage percentage in 2008, the biggest difference between the two coming in 2011, with inflation percentages being almost 2 per cent above the minimum wage.
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5 Responses to “The minimum wage vs inflation (graph)”
Tim Allan
It’s probably worse than that. Economists say the real level of inflation has been double the gov “measure” since 2007. Combined with the benefit cap and the £2bn tax break for banks, we have a perfect illustration of the economic war being waged against us by the richest and most powerful via their stooges in office.
http://economicwardiaries.wordpress.com/2013/04/15/the-day-that-crystallised-the-war/
Tim Allan
It’s probably worse than that. Economists say the real level of inflation has been double the gov “measure” since 2007. Combined with the benefit cap and the £2bn tax break for banks, we have a perfect illustration of the economic war being waged against us by the richest and most powerful via their stooges in office.
http://economicwardiaries.wordpress.com/2013/04/15/the-day-that-crystallised-the-war/
Teddy Mcnabb
Can we get away from this bollocks of a title “minimum” wage, its labour poverty wage, with 10 p tax and a foodbank voucher, you don’t hear labour screaming about its fall in value, well you wouldn’t they are a bunch of privileged careerist eitist Tories in Red Coats. VOTE LABOUR GET A TORY..
John Ruddy
Actually, you do hear Labour complaining about it – they complained last year when it was frozen too.
I think you need to think back to the time before the minimum wage was introduced. I recall new staff being taken on at less than £2 an hour in 1996 – barely more than JSA. The national Minimum wage was transformational (my boss reckoned it would force him to close his business – except he didnt, and he still managed his many foreign holidays and flash new cars every year).
thechristophe
This graph ignores the changes in personal allowance. For the first time ever, those on minimum wage are seeing their income tax bill fall, under Labour income tax for those on minimum wage increased every year: http://bit.ly/135CPrZ