Minimum Wage for 16-18 Year olds

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The minimum wage for workers aged 16-18 is £4.55 (April 2020-21)
For workers, aged 18-20 is currently £6.45 (April 2020-21)

Readers Question: What are the minimum wage rates for 16, 17 and 18-year-olds. Should the minimum wage be increased?  Should there be a minimum wage rate for children under 16?

Minimum Wage Rates from April 2020

  • £8.72 –  25 and over
  • £8.20 – Age 21-24
  • £6.45 – Age 18-20
  • £4.55 – Under 18
  • £4.15 – Apprentice rate. (An apprentice means the firm has to devote a certain time to training the worker. Traditionally apprentices get lower pay to compensate the firms’ cost of training them.

Can 13, 14, and 15-year-olds get a minimum wage rate?

No, the minimum wage rate only applies to workers who are 16 and above.

The youngest age your child can work part-time is 13 years old, with the exception of children involved in: television, drama, film. [1. Child employment Direct gov]

Do young workers benefit from a national minimum wage?

national-minimum-wage-pros-cons

Benefits of Min Wage

  • A minimum wage is an effective tool for increasing wages of the lowest paid group of workers.
  • Since the minimum wage has been introduced in 1997, unemployment has fallen, suggesting fears over real-wage unemployment have been misplaced.
  • Minimum wages can increase labour productivity. Workers can feel more motivated with higher wages (efficiency wage theory). Also, if firms have to pay more, then they have an incentive to invest in workers and capital to increase labour productivity.
  • In an era of low real wage growth, the minimum wage has played an increasing role in causing higher living standards.

Concerns over minimum wage

  • An argument advanced is national minimum wage increases costs for firms and this can discourage employment opportunities. If the minimum wage rate rises too fast, it could cause unemployment in the future.
  • The gap between workers under 18 and over 25 means that firms have a cost incentive to substitute older workers for younger workers. In labour intensive industries (e.g. fast food) firms may prefer to give longer hours to the youngest workers because they are nearly 50% cheaper than mature workers.
  • Blackmarket. Another issue is that a legal minimum may encourage firms to pay young workers in cash and avoid legal restrictions.
  • Regional inequality of wages. A national minimum wage can cause unemployment in the northeast (where wages are low) but have little effect in London, where wages are higher.

Does a minimum Wage encourage Labour market Participation?

  • In theory, increasing the minimum wage for 16-18 year old workers would increase the incentive to join the labour market because work will become more attractive compared to studying at school and not earning.
  • However, the minimum wage for 16 and 17 year-olds is still relatively low. It is £4.20 for people under 18. Therefore, the benefit of working on the minimum wage may still seem insignificant compared to the benefits from studying and getting qualifications which will enable higher lifetime earnings.
  • Also, many 16 and 17  year-olds probably live rent free therefore there is not the same economic necessity to go out and get a job.
  • Personally, I think the effect of a minimum wage for 16-18 year olds is relatively insignificant, I can’t think of many students who would give up A-levels just so that they could go and work in McDonald’s for £4.20 an hour.
  • What is most likely is that there will be an increase in the participation of young workers doing part-time jobs in addition to studying full time.

Case for Increasing the Minimum Wage Rate

  • Unfair firms can pay a lower wage rate to young workers doing the same job as people over 21.
  • Efficiency Wage Theory – the idea if you pay a higher wage, you will get greater motivation and labour productivity.

Problems of Increasing the Minimum Wage Rate for young workers

  1. Could lead to unemployment and fewer job opportunities. Many firms may be unwilling to employ workers if there is a significant increase in the minimum wage rate. This would particularly affect labour-intensive industries like hairdressers and cafes.
  2. Arguably young workers lack experience, and so firms need to spend time and money on training them. Therefore a lower minimum wage rate is justified to pay for the costs of on-the-job training.

How Does the UK compare to other countries?

The UK minimum wage compares well compared to other countries like the US, Spain and Portugal, but still lower than some EU countries. International minimum wage rates

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241 thoughts on “Minimum Wage for 16-18 Year olds”

  1. Hi im a 15 year old boy, work on a farm for 10 hours a day and have a 4 hour break, i earn 20 pound for these hours. Is this good for a farm job ? or should i ask for a raise ?

  2. Im 19 years old,

    I work for £5.50 per hour at pizza hut as a delivery boy and get paid 80pence per drop. Theres not enough money becuase that 80pence is less than what it costs for fuel let alone car maintenance has to come out my hourly wages, so basically im working for about £1.50 an hour on average as car maintenace, repairs costs alot when purchasing parts and paying for labour.

    I also work for homebase which i earn just over £6p/h and also get 1% commission on the products I sell, so this is not a bad paid job as it does not cost me anything just hardcore labour and selling techniques.

    IS THIS RIGHT??

  3. im 16 years old and work at a hairdressers which is busy.
    i work 8:50am till 6pm/6:30pm and for my dinner break i go out to get it come back with my lunch which takes me no more then 5mins and when i come back i dont get chance to have my dinner as i get called away to help.
    and i get paid £20 for the day.
    when i worked out the average pay for a 9-6 working day it came up a : £32.13 even though its only £12.13 when you add it all up over a length of time theres a difference.
    i dont know if this is okay for the hours i work
    but standing on my feet for that long only have 15min break i think its pritty unfair.
    is my view but at the end of the day i know its experience but i think we should all be entitled to the right pay and not under pay

  4. I reckon since people can legally work from the age of 16 full time or part time, the set minimum wage for 16-18 should be at least £5ph…a comment earlier pointed out the clear fact that we have to pay adult faire on buses from the age of FOURTEEN, yet because we are not ADULT yet we do get paid an adult wage! How can this be justified I ask?!?!?

  5. me n my gay partner, reckon since people can legally work from the age of 54 full time or part time, the set minimum wage for 35-90 should be at least £5ph…a comment earlier pointed out the clear fact that we have to pay adult faire on buses from the age of FOURTEEN, yet because we are not ADULT yet we do get paid an adult wage! How can this be justified I ask?!?!?

  6. I am 16 and I have been working in a pub in my local area for about 10 months now and I am on £4 an hour seeing as though I started when i was 15 I feel that my pay is good.
    I can see where most of you are coming from that you feel the minimum pay is a bit low but at the end of the day your employer is the one who decides on how much you receive, £3.53 in just a minimum amount that your employer has to pay you.
    All you have to think about is they are acctually paying you and allowing you to work in their working enviroment, so yes your pay not be as good as some peoples but ask yourselves out of all your friends are the only one that has got off you butt and got a job?

  7. I don’t really think we should talk about right or wrong- businesses exist to make a profit and even if a 16 year old is as good, worse or better than an adult if it is possible to pay them less than from a business’ point of view that is what should be done, never mind personal feelings on the subject. I don’t like it but I can understand why it works this way- the only way to get a change is to stop people working for bad wages. It is simple supply and demand plus cost cutting- if many people want jobs, it is low pay, and high pay when there are few.

  8. I have just turned 16 and have been working since i was 14. I started off at £4.50 ph and have been raised to 5 ph

  9. i think this is all pathetic i am in colege 3 days a week and they class that as im in full time education i get £60 a fortnight ema and that goes no were these days been searching for a job for month cant get anything so some of these people should be lucky they can get a job cause at least the money the earn helps its better than earning nothing when you havent got a job i need a job to save to get a car to get a better job and earn more money guna be retired by the time i can afford a car

  11. I have 7 to 8 kids, unknown 8th, could be mine, on min wage plus 44p more, is this fair, i love chips

  12. hi i wrk in a factory based enviroment (mechanical fitting)
    i get paid £3.75 an hour and my boss who does hardly as much has me is on £12 an hour its nt fair as i wrk my bollocks of and he tells me wat to do all day for 12 quid i bring home 145 a week for 40 hrs also i dont do weekends cos i wud get 17.50 quid for satday nt worth going in
    it also pisses me of how people younger get paid a lot less i no we havent gt much experience but being a hard wrker changes everything in my opinion

    and people wonder why people like me toss it off at wrk
    yep i wonder too haha

  14. ouch..those minimum rates look ugly..though i have plenty of friends around 15-17 who get around 8 or 10 dollars per hour around adelaide and perth,so im not scared..just gotta get a good job,like in a hotel or something 🙂

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