Employment and Hours Impacts of the National Minimum Wage and National Living Wage in Northern Ireland, 2017

McVicar, Duncan and Park, Andrew and McGuinness, Seamus (2017) Employment and Hours Impacts of the National Minimum Wage and National Living Wage in Northern Ireland, 2017. [Working Paper]

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Abstract

This report examines the employment and hours impacts of the 1999 introduction of the UK National Minimum Wage (NMW) and the 2016 introduction of the UK National Living Wage (NLW) in Northern Ireland (NI) using Labour Force Survey data. Because NI is a relatively low-wage region of the UK we might expect minimum wages to have more impact on employment and hours in NI than in other parts of the UK. NI is also the only part of the UK with a land border – the border between NI and the Republic of Ireland (RoI) – where the NMW and NLW cover those working on one side of the border but not those working on the other side of the border. This discontinuity in minimum wage coverage enables a research design that estimates the impacts of the NMW and NLW by comparing changes in employment and hours north and south of the border around the time of the NMW and NLW introductions. In practice we estimate a number of alternative models using this approach. Although no existing study of minimum wage impacts has previously exploited this particular border, there is a long tradition of estimating minimum wage impacts in this way, particularly within the US where the minimum wage varies across states and even within states.

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