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Effects of Minimum Wages on the Gender Pay Gap

Published online by Cambridge University Press:  26 March 2020

Shirley Dex ,
Holly Sutherland  and
Heather Joshi
Shirley Dex
Affiliation:
Judge Institute for Management Studies, University of Cambridge, Trumpington St, Cambridge, CB2 IAG
Holly Sutherland
Affiliation:
Department of Applied Economics, University of Cambridge, Sidgwick Avenue, Cambridge, CB3 9DE
Heather Joshi
Affiliation:
Centre for Longitudinal Studies, Institute of Education, 20 Bedford Way, London, WCIH OAL
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Abstract

This article explores the implications of alternative policy regimes for gender wage inequality. Against the background of a description of recent changes in pay ratios of men and women in Britain, the focus is primarily on calculating the likely effects on gender wage ratios of introducing the statutory minimum wage in the UK. The effects of alternative options are also assessed in part; giving women men's average hourly earnings, leaving occupations unchanged, and redistributing women through occupations in the same proportions as men, leaving their occupational average pay unchanged. The largest effects on pay ratios come from giving women the same pay as men in their existing occupations. However, a statutory minimum wage of £3.60 per hour does improve the gender pay ratio and helps women at the lower end of the pay spectrum. It is also considerably easier to implement than other options.

Type
Articles
Information
National Institute Economic Review , Volume 173 , July 2000 , pp. 80 - 88
Copyright
Copyright © 2000 National Institute of Economic and Social Research

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Footnotes

A much longer version of this paper was given at the OECD Conference ‘Changing Labour Markets and Gender Equality: The Role of Policy’, Oslo, October 1998. Thanks are also due to two anonymous referees.

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