Macbeth Essay

1983 words - 8 pages

Current Issues Note 7GLA Economics 6GLA Economics Current Issues Note 71London's living wage for young peopleThe Living Wage Unit, GLA EconomicsIn A Fairer London: The Living Wage in London GLA Economics, 2005, A Fairer London: The Living Wage in London. View: www.london.gov.uk/mayor/economic_unit/docs/a_fairer_london.pdf, the Mayor of London announced a London living wage of £6.70. The circumstances and living costs of young people and apprentices are different from working adults who are not in training. This is recognised, for example, by the government's establishment of a separate national minimum wage for young people and trainees.This current issues note proposes a living wage for young people using a methodology consistent with that used to calculate the adult London Living Wage. In what follows the rationale for such a living wage is discussed. In the interests of brevity we will describe this as the youth living wage. We explain the methodology used to estimate housing costs and the youth living wage in London, only based on the Basic Living Cost approach In A Fairer London: The Living Wage in London two approaches were used to calculate the living wage. The Basic Living Cost approach calculates the wage required to cover specified living costs. The Income Distribution approach considers the wage required to move a household to 60 per cent of median income - a commonly used definition of the poverty line. . Our calculations suggest a youth living wage in London of £5.60 per hour.1. Rationale for a youth living wage in LondonApprenticeships provide opportunities for young people to be trained, gain skills and develop work experience. This improves their future job and earnings prospects in the longer term, and helps to engage young people who might not otherwise take part in education or training.Apprentices and young people generally receive lower remuneration compared to working adults. In recognition of this and the fact that young people are still acquiring skills and experience in the labour market there is a lower statutory minimum wage for young people aged 18-21 years and since October 2004 for 16 and 17 years olds. The current minimum wage rates are £5.05 for adults, £4.25 for those aged 18-21 years and £3.00 for 16 and 17 year olds. In contrast with the position on the national minimum wage we are suggesting just one youth/apprentice living wage for 16-19 year olds. This is because the living wage is meant to cover minimum living costs, while the youth minimum wages are set by central government and have regard to the labour market position of young people.Data from the Labour Force Survey (LFS) indicates that about nine per cent of young individuals (aged 16-19 years old) either have completed or are still doing a trade apprenticeship in London, this compares with 15 per cent in the rest of the UK.In London, the wages of apprentices are somewhat less than a half of the adult median London wage...

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