Book contents
- Frontmatter
- Dedication
- Contents
- List of tables
- Preface and acknowledgements
- Introduction: the challenge of a living wage
- 1 Minimum wage workers and the low-wage labour market
- 2 Low-wage workers and threats to working-class living standards
- 3 The crumbling orthodoxy: arguments for low minimum wages
- 4 Enter the new politics of the living wage
- 5 Challenges to living wage welfare states
- Conclusion: living wages and liberal welfare states in the 21st century
- Notes
- References
- Index
5 - Challenges to living wage welfare states
Published online by Cambridge University Press: 04 January 2022
- Frontmatter
- Dedication
- Contents
- List of tables
- Preface and acknowledgements
- Introduction: the challenge of a living wage
- 1 Minimum wage workers and the low-wage labour market
- 2 Low-wage workers and threats to working-class living standards
- 3 The crumbling orthodoxy: arguments for low minimum wages
- 4 Enter the new politics of the living wage
- 5 Challenges to living wage welfare states
- Conclusion: living wages and liberal welfare states in the 21st century
- Notes
- References
- Index
Summary
To move in the direction of a fair wage, we have to re-think a whole set of institutions and policies which interact with each other: these include public services, and in particular, education, labour law and organisations and the tax system. (Thomas Piketty 2016)
The minimum wage cannot do all the work on its own. (A.B. Atkinson 2015)
Chapter 4 has shown that minimum wage developments in the six liberal countries are de facto welfare state-building initiatives. They are predictable but important responses to ongoing crises of overburdened labour markets that have been driven by mobilisation as well as institution-building within established politics. Both forms of pressure have been helped by a weakening of a policy monopoly that once dominated policymaker decisions, stalling living wage initiatives. While these reforms can be characterised as only partial solutions to the larger injustices of poor wages, the evidence is clear: higher minimum wage floors have provided one of the few forms of stimulus to an otherwise depressed wages outlook.
Higher minimum wages have also emerged as more vital policy response outside the liberal world. The South Korean example is the most spectacular, underlining the tactical use of minimum wage floors as predistribution where social policy is weak. My claim that these reforms have a particular significance to the reform trajectories of the liberal world rests on three premises. First, liberal labour markets have, by design, fewer institutional levers to correct for rising inequality. Second, the policy monopoly in favour of low minimums has been more ‘hegemonic’ in states like the US and the UK, with these policy networks dominating liberal policymaking. And, third, welfare austerity across the liberal world has increased dependence on lowwage labour markets more than in similarly affluent countries.
This chapter takes a necessarily more speculative path, looking at prospects for a further development of living wage policies. At the same time, it considers the threats and alternatives to stronger minimum wage institutions. The obvious threat to more encompassing policies is a serious and protracted recession with a major impact on low-wage employment. That has now happened with the COVID-19 pandemic. A slow and politically fraught path to recovery looms in the 2020s that points to significant discontinuities with the politics of the previous decade.
- Type
- Chapter
- Information
- Living Wages and the Welfare StateThe Anglo-American Social Model in Transition, pp. 151 - 170Publisher: Bristol University PressPrint publication year: 2021