Living wages are an increasingly common policy tool for reducing poverty and improving the living standards of low-income workers. But until recently, there has been little evidence on how living wage clauses effect the largest spender in the economy - the government. This column utilises data from a firm operating in the low-pay service sector with hundreds of establishments across the UK. The authors find that the living wage policy was a relatively successful way to increase wages and reduce within - establishment wage inequality without incurring significant negative employment effects.

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31 March 2025

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Vox EU

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https://cepr.org/voxeu/columns/living-wages-and-government-contracts

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