BUT WHY ARE 21- AND 22-YEAR-OLDS STILL MAKING LESS?
From 1 April 2021, employees aged 23 and 24 will jump from earning £7.70 an hour to £8.91 an hour – as the highest age bracket for workers earning the National Minimum Wage is lowered from aged 25 and above to aged 23 and above. The change to this top age group (also known as the National Living Wage) will be a boost for around a million young people (including many recent graduates), and is a recognition that workers aged 23 and 24 are worth paying the same as older adults – an argument that this website has been making on your behalf, for FIVE years.
Recent graduates may be surprised to learn that until April 2016 the top minimum wage age bracket started at aged 21 (scroll down to see how wages have changed in recent years). That’s right – whether you were aged 21, 22, 23, 24, 25, 35 or 65, if you were on the minimum wage, you were paid the same amount. So, what happened – and why did the age bracket jump up so that workers aged 21, 22, 23 and 24 were pushed out and kept on a lower wage than those aged 25 and above?
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Good question – and we wish we had a good answer to give you. At the time – and since then – Graduate Fog has repeatedly questioned why this decision was taken, and what evidence was factored in.
We found it hard to understand the logic behind why an employee should be considered a grown-up at 25, but not at 21. Is a 25-year-old more experienced? Often, but not always. Is their work better, just because they’re older? Not necessarily. And if their work is the same standard and worth the same value to the employer, why should someone be paid less to do the same role, simply because of their age? Isn’t that the dictionary definition of ageism?
As Tanya de Grunwald, founder of Graduate Fog, explains:
“Over the years, we have heard several wooly theories and explanations for the jump in the starting age of the highest NMW bracket (later re-branded – confusingly – as the National Living Wage). However, none has ever been stated as the definitive reason, and no evidence has been presented to back it up.
“For example, it was suggested that in 2016 the government was trying to encourage firms to hire more under-25s and feared that bosses would be put off and go for older employees, if they had to pay them all the same. In other words, younger people could only be more appealing than older people if they were cheaper. As far as we know, there is no data to support this idea. And, even if the theory holds, then why is the government lowering the starting age for this bracket now, when you’d think they’d be more desperate than ever that jobs should go to young people? It doesn’t make sense.
“Another idea was that young people have lower living costs, as they are more likely to be able to live with their family during their early years of working. But plenty of under 25s don’t live with their family at this stage in their life – and their careers options are greatly limited geographically if they do. Even if they can live with their family, should that dictate how much money their employer should have to pay them for their work? I don’t see older workers having their wages calculated based on their living arrangements, and how much they need – or don’t need – to earn, so it seems highly unfair to assess young people’s pay requirements like this.
“Anyway, it’s good news of sorts that the starting age for the top bracked of minimum wage is coming down a little bit, at last. If you’re 23 or 24, congratulations: you are a fully-grown adult in the eyes of the government, and HM Revenue and Customs. But I’m afraid it’s bad news if you’re 21 or 22. Apparently, you still aren’t quite a grown-up just yet…”
IN THE MONEY? See how the minimum wage has crept up slowly, in recent years
WHAT CHANGED AND WHY? See how the top rate of minimum wage started at aged 21, until April 2016. No explanation has ever been provided for this change
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