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The UK minimum wage at 22 years of age: a regression discontinuity approach

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Summary

A regression discontinuity approach is used to analyse the effect of the legislated increase in the UK national minimum wage that occurs at age 22 years on various labour market outcomes. Using data from the Labour Force Survey we find an increase of 3–4 percentage points in the rate of employment of low skilled individuals. Unemployment declines among men and inactivity among women. We find no such effect before the national minimum wage was introduced and no robust impacts at age 21 or 23 years. Our results are robust to a range of specification tests.

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