Welfare Reform on the Web (August 2003): National Minimum Wage - UK

ANTICIPATING AND ADJUSTING TO THE NATIONAL MINIMUM WAGE IN THE HOSPITALITY AND CLOTHING INDUSTRIES

R. Lucas and M. Langlois

Policy Studies, vol. 24, 2003, p.33-50

Article discusses how hospitality and clothing firms managed the introduction of the national minimum wage in the period leading up to its arrival on April 1st 1999. Clothing firms raised workers' pay in anticipation of the minimum wage and concentrated on improving workforce performance and product quality to compensate for the extra cost. Hospitality firms reacted passively and simply paid up when they had to, relying on cost cutting measures to compensate.