Income Supplementing and the Poverty Trap: Speenhamland Revisited?

Résumé 0

The reduction of the working week is emerging as an alternative to. more traditional strategies designed to tackle unemployment, but adjusting pay downwards in order to absorb the decrease in time at work is proving to be difficult. The most successful attempts to date have been recorded in industries where jobs would otherwise have been threatened. Any reduction in wages for the low‑paid whose union representation and industrial organisation is very often sparse, can jeopardise their ability to satisfy a "decent" standard of living. The recent abolition of minimum wage protection in Great Britain has meant that market forces are more than ever relied upon to dictate wage levels. By removing the remaining safety nets, employers are no longer required by law to pay minimum wages and the responsibility for paying "decent" wages has been shifted from them onto the social security system. This chapter will look at the desirability and operation of such a system whereby social funding is called upon to top‑up wages. Wage supplementation might encourage and maintain low wages and non‑economic activity. Alternatively, it might increase access to the labour market for certain categories of workers.