{"text":[[{"start":8.23,"text":"If you think of a person who is being paid less than the minimum wage, who comes to mind? Someone washing cars under a railway arch? Someone sewing clothes in a small factory for cash in hand? How about someone tapping away in an office for an annual salary?"}],[{"start":26.46,"text":"In Britain, the fast-rising minimum wage is catching up with the bottom rungs of white-collar work. Indeed, it appears that a growing number of workers outside the traditional low-paid sectors are not even getting the legal minimum rate of pay."}],[{"start":45.69,"text":"How did we get here? In 2016, Britain’s Conservative government began to push up the minimum wage sharply relative to the pay of the median worker. In a stagnant era in which median pay was barely rising in real terms, successive governments continued to increase the wage floor in order to make sure that workers at the very bottom, at least, received pay rises. As a result, the UK minimum wage is now about two-thirds of median pay. By this measure, the UK government says the country has the second-highest minimum wage rate in the G7."}],[{"start":89.34,"text":"At £12.21 per hour, the adult rate in the UK is now equivalent to an annual full-time salary of roughly £22,000 to £25,500, depending on the number of working hours you assume. Data provided to the FT from Indeed, the job advert website, suggests this is getting close to advertised bottom decile salaries in a number of white-collar sectors, such as marketing, IT and legal jobs."}],[{"start":null,"text":"
"}],[{"start":121.84,"text":"Does that mean university is no longer “worth it”? For most young people, getting a degree still puts them on a better lifetime progression ladder, at least for now. The Institute for Fiscal Studies has estimated that about 80 per cent of students are likely to gain financially across their working lives from attending university. That said, the prospect of near-minimum wage entry-level salaries will surely add to the complaints of recent graduates, who also face the possibility that artificial intelligence will destabilise the traditional professional career ladder."}],[{"start":160.79000000000002,"text":"As for white-collar employers, more of them will have to get to grips with minimum wage law. The latest report on minimum wage non-compliance from the Low Pay Commission, the independent body which oversees the policy, estimated the number of underpaid workers in non low-paying sectors had risen by nearly 40 per cent since 2019. The LPC also found there are now more underpaid salaried workers (about 186,000, based on official data from 2024) than underpaid hourly-paid workers (about 158,000)."}],[{"start":201.67000000000002,"text":"The LPC said it was “possible that a fast-rising [minimum wage] has caught some employers of salaried workers unaware of the annual salary required to be compliant.”"}],[{"start":null,"text":""}],[{"start":216.72000000000003,"text":"Hours are also trickier to measure in white-collar work. It’s not unusual for salaried workers to exceed their contracted hours, perhaps clawing back some time in lieu later. But as more of these entry-level jobs come into the sights of HMRC, which enforces the minimum wage, a casual approach to recording working hours will become problematic, especially because the regulations in this area are fiendishly complex. For employees close to the wage floor, using salary sacrifice for pensions also risks dragging their pay below the minimum, in the eyes of the law."}],[{"start":258.07000000000005,"text":"Josiah Greenall, a national minimum wage specialist at KPMG, told me that some clients, who were confident the minimum wage wasn’t an issue for them two or three years ago, were now keen to understand the risks. “We’re having a lot of conversations with employers about working hours records,” he said."}],[{"start":280.90000000000003,"text":"Outside of the white-collar world, the fast-rising minimum wage has also contributed to a sense of being undervalued among some skilled workers such as truck drivers, who have seen their median hourly pay premium over the minimum wage erode from 62 per cent in 2011 to 38 per cent by 2024. And it has compressed the pay differentials between entry-level and supervisor roles in lower-paid sectors such as retail and leisure, which some employers complain has dissuaded people from taking on promotions."}],[{"start":324.94000000000005,"text":"When I was writing about the prospect of Britain’s great minimum wage experiment a decade ago, the big concern was that it might destroy jobs. “Just as paracetamol is safe in a low dose but dangerous at a high one, so too are minimum wages,” Chris Dillow, the economics writer, said at the time. Mass job losses didn’t materialise. Indeed, the experiment has proved very successful in raising pay for people at the bottom. But while the paracetamol dose hasn’t killed the patient, some of the side-effects are now causing a headache of their own."}],[{"start":375.12000000000006,"text":""}]],"url":"https://audio.ftmailbox.cn/album/a_1747725857_7741.mp3"}