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Welfare Reform on the Web (January 2002): Minimum Wage - UK

THE POTENTIAL IMPACT OF THE MINIMUM WAGE IN RURAL AREAS

A. Gilbert, E. Phimister and I. Theodossiou

Regional Studies, vol. 35, 2001, p. 765-770

Article explores the extent to which the potential impact of the national minimum wage might differ in rural areas. Using pre-1999 data from the British Household Panel Survey, a number of dimensions of the policy's potential impact on rural areas are considered; in particular, the number of workers affected their typical characteristics, and the effects on pay inequality and household income distribution. Results show that for the majority of rural areas that are accessible to urban labour markets, the impact is broadly similar across rural and urban spaces. In contrast, the potential impact, and particularly the distributional effects, of the minimum wage are likely to be greatest in remote rural areas where labour markets are less integrated with urban ones.

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