The National Minimum Wage - Advantages and disadvantages table in GCSE Economics

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Created by: Alice
Created on: 29-10-15 15:40

The National Minimum Wage

Advantages

higher tax revenue
less need for beneift top ups
fairer more equal distribution of income
reduced poverty

Disadvantages

workers are more expensive, unemployment up
other workers will demand pay increases = inflation
young workers will loose out as firms will prefer older workers
doesn't take into account differing costs of living

Evaluation

depends on the elasticity of demand for labor. if it is very elastic there will be a large amount of job losses.if the poorest in society don't work whats the point?surely a low wage is better than none at all?

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