Good news! Young workers have received a pay rise
You might think that the National Living Wage would not be much help to young workers as it only legally applies to over 24-year-olds. However, new research begs to differ.
Research by the Resolution Foundation among social care workers found that just over half benefited from the new £7.20-an-hour rate, which came into effect in April, rising to four out of five young employees.
The think-tank said there were wider knock-on benefits for pay in the sector, with no evidence of employers cutting back on shifts to finance the wage rise. Phew.
However, the report also revealed a "bunching" of pay rates at the legal minimum, saying this was a cause for concern. The extra cost of the Living Wage in social care is set to reach £2.3 billion by 2020, said the Resolution Foundation.
Senior researcher Laura Gardiner said: "It is great news that the National Living Wage has had a large positive impact on pay in social care, giving hundreds of thousands of front line care workers a pay rise, with no evidence of hours being cut to foot the bill.
"It is encouraging that younger workers have also benefited from the new 25-and-over rate, despite having no legal entitlement to the National Living Wage. In fact, across the age range social care employers are clearly doing much more than the bare minimum where pay is concerned, with the average pay rise double what it would have been had bosses just increased pay to the legal wage floor."
Gardiner warns that by 2020 we risk reaching a crunch point, potentially damaging the care sector.
There are one and a half million adult social care workers in England, with a sample of 200,000 covered in the report.
A Government spokesman said: "The National Living Wage is an essential part of moving to a higher wage, lower tax, lower welfare society where work always pays and the majority of households are better off.
"The Resolution Foundation's research shows that workers of all ages are getting more money in their pockets thanks to the introduction of the National Living Wage."