Time for a Pay Check: Should we Scrap Minimum Wage for Young People?

Eamonn Butler, a member of the Adam Smith Institute, suggested last month that the minimum wage should be scraped for people under the age of 25.

His reasoning was that, with the economic downturn, employers find it easiest to save money by making their youngest employees redundant. Thus, in order to get the 20.5% of unemployed young people back in the work place, minimum wage should be done away with, hopefully encouraging employers to hire or rehire their young employees for a smaller wage. I am not going to pretend to be an economic expert, but I find this argument narrow as it refuses to see many problems that will arise with not having a minimum wage for young people.

Most obviously, minimum wage is designed to protect people from, effectively, being exploited by employers offering an unfair wage. Without it, it appears to be nothing short of slave labour. The people who are in need of the protection of a minimum wage law are likely to be the poorer members of society, who are already struggling with income, as well as the lack of employment opportunities in this current economic climate. They are probably not going to be in a position where they can simply quit their job if their employer is paying them an unreasonable salary. Being trapped in this employment web begs the question, how can we differentiate between our society today and the society of Queen Victoria where the poorer members had little to no social security? Surely we have moved on since then? Surely we have a duty to those less fortunate then ourselves?

It often seems that young people get battered from all angles. Despite a push to get more students into higher education, the government is now allowing universities to charge up to £9000 a year for tuition. For those at the other end of the social scale, benefits could become harder to claim for young people if Ian Duncan Smith’s proposal to reform the welfare system gets passed. If minimum wage gets scraped, this will only add to the pressure. If university is too expensive, benefits unavailable and jobs offering little wage, what kind of future prospects does this offer to young people?

Furthermore, disposing of the minimum wage law appears to be discouraging towards young people. What’s the point of working if you will only be undervalued and underappreciated? The subtext of Butler’s article is contradictory, suggesting that young people are of little use in the work place, and yet, must not be unemployed. Where does this leave young people? If people never give us the opportunity to work, how will we have gain the experience and the essential skills needed to be a desirable employee? A fair wage will allow us to enter the work place feeling valued, making us responsive to our positive working environment, which will, hopefully, turn us into a ‘desirable’ employee. Scraping minimum wage is only starting on the wrong foot, or rather, on the wrong pay.

With a new government, we may expect new opportunities. The Guardian claims David Cameron is encouraging ‘responsibility, autonomy and work’, but is this being taken too far? Do we have a greater responsibility towards making a profit than looking after the employees who will eventually run the business? Does scraping minimum wage encourage autonomy of the businessman at the expense of the employees? Finally, how far are we willing to go to get young people into the work place? The proposal to scrap minimum wage only seems to create more questions than it answers.

To read Eamonn Butler’s article, please go to: http://www.adamsmith.org/blog/welfare/scrap-the-minimum-wage-for-young-people

Time for a Pay Check: Should we Scrap Minimum Wage for Young People?

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