30% of workers on minimum wage are better paid within 9 months

Most workers’ pay increases without having to move jobs, says ESRI study

Minimum wage workers are  more likely to lose their jobs than higher paid employees, according to the ESRI study.

Minimum wage workers are more likely to lose their jobs than higher paid employees, according to the ESRI study.

 

About one in three workers on minimum wage moved to higher paying jobs within nine months, a study by the Economic and Social Research Institute (ESRI) has found.

The think tank’s report, funded by the Low Pay Commission and published on Wednesday, found that minimum wage work often acts as a stepping stone to jobs with better pay.

“Over a nine-month period, approximately 30 per cent of minimum wage employees transitioned to higher pay, with 18 per cent staying on the minimum wage,” the ESRI said.

Most workers’ pay increased as they remained in their jobs so they did not have to move to a new employer in order to boost their wages.

However, the institute warned that some groups, including foreign nationals, workers with poor education, part-time employees and those on temporary contracts, were more likely to remain stuck on minimum pay.

Minimum wage workers are also more likely to lose their jobs than higher paid employees, according to the study.

“While minimum wage employment acts as a stepping stone to higher pay for many employees, it is also important to note that it can represent a low-wage trap for certain types of workers and is also associated with a greater likelihood of becoming unemployed,” said Dr Paul Redmond, one of the report’s authors.

Dr Donal De Buitléir, chairman of the Low Pay Commission, which aids the Government in setting the minimum wage, welcomed the report. He said it provided much-needed information on the factors that influenced minimum wage workers’ ability to change to better paid jobs.

The paper was produced under a research partnership agreement between the commission and the ESRI.