The Geographies of the National Minimum Wage

Abstract

Geographers have recently argued that labour-market regulation interacts with market forces in profoundly different ways in different local labour markets. We illustrate this argument by using the case of the new statutory minimum wage in Britain. We consider whether the introduction of the national minimum wage represents a genuine departure from the preceding neoliberal labour-market regime, and examine how far it will begin to redress some of the pronounced geographical inequality in wages across local labour markets which developed under that regime. To provide comparative context, we examine the international geography of minimum wages and assess whether, and to what extent, the new UK minimum wage indicates a shift towards a new model of labour-market governance and regulation. We then review the geography of low pay in the United Kingdom and consider the possible geographical impact of the new national minimum wage. We argue that the effects of the minimum will vary depending on the nature of local labour-market characteristics. Then, perhaps most contentiously, the case is considered for regionally differentiating the minimum wage to reflect geographical differences in the cost of living. Finally, we examine the arguments for and against a single uniform national minimum in the light of administrative systems operated in other countries.