Table 1
Introduction of NMW and NLW as natural experiments
| Before | After | |
|---|---|---|
| NMW introduction, 22+ years | 1998Q2–1999Q1 | 1999Q2–2000Q1 |
| NI minimum hourly wage | N/A | £3.60 |
| RoI minimum hourly wage | N/A | N/A |
| NLW introduction, 25+ years | 2015Q4–2016Q1 | 2016Q2–2016Q3 |
| NI minimum hourly wage | £6.70 | £7.20 |
| RoI minimum hourly wage | €8.65 (2015Q4) | €9.15 |
| €9.15 (2016Q1) |
[i] Note: In sensitivity analysis, we also explore the exclusion of 2015Q4 in the “before” period for the introduction of the NLW.
[ii] NI, Northern Ireland; NLW, National Living Wage; NMW, National Minimum Wage; RoI, Republic of Ireland.
Table A1
Appendix: Additional Data Details and Results
Variable definitions and descriptions
| Variable | Definition | Description |
|---|---|---|
| Outcome variables Employment | Employed in the reference week | Employed in the reference week = 1, 0 otherwise |
| Employment in minimum wage sector | Those employed in the reference week in sectors with high concentrations of minimum wage workers | Employed in the following sectors: UK SIC07 G, I, and Q = 1, 0 if employed in other sectors* |
| Total actual weekly hours in main job | Total actual hours worked in main job in the reference week including overtime | This variable is constructed from TTACHR from the QLFS and HWACTUAL from the QNHS |
| Total usual weekly hours in main job | Total usual hours worked in main job including overtime | This variable is constructed from TTUSHR from the QLFS and HWUSUAL from QNHS |
| Controls Male Age, years Age squared | Sex of respondent Age of respondent in years Age of respondent in years, squared | Male = 1, female = 0 Age of respondent in years Age of respondent in years, squared |
| Single | Respondent’s marital status is single | Respondent’s marital status is single = 1, 0 otherwise |
| Married/cohabiting | Respondent’s marital status is mar- ried/cohabiting | Respondent’s marital status is married/cohabiting = 1, 0 otherwise |
| Widowed | Respondent’s marital status is wid- owed | Respondent’s marital status is widowed = 1, 0 otherwise |
| Divorced | Respondent’s marital status is di- vorced | Respondent’s marital status is divorced = 1, 0 otherwise |
| Number of Children under the age of 18 years in household | Number of children resident in the household | Number of children under the ages of 17 (RoI) and 19 (NI) years, resident in the household |
| Number of children under the age of 18 years in household missing | Dummy for missing data on the num- ber of children <18 years | Missing =1, 0 otherwise |
| ISCED 1 | Respondent reports highest level of qualification as “no qualifications” or equivalent | ISCED 1 = 1, 0 otherwise. |
| ISCED 2 | Respondent reports highest level of qualification as General Secondary Certificate of Educations (GCSEs) (NI)/ Junior Certificate (RoI) or equivalent | ISCED 2 = 1, 0 otherwise |
| ISCED 3–4 | Respondent reports highest level of qualification as A-level (NI)/leaving certificate (RoI) or equivalent | ISCED 3/4 = 1, 0 otherwise |
| ISCED 5 | Respondent reports highest level of qualification as sub-degree level higher or further education | ISCED 5 = 1, 0 otherwise |
| ISCED 6 | Respondent reports highest level of qualification as degree level or higher | ISCED 6 = 1, 0 otherwise |
| ISCED missing | Dummy for missing data on highest qualification level | Missing =1, 0 otherwise |
Table 2
Sample means/proportions (standard deviations) for outcomes and other observable characteristics, NI and RoI, pre and post the introduction of NMW
| NI | RoI | |||
|---|---|---|---|---|
| 1998Q2–1999Q1 | 1999Q2–2000Q1 | 1998Q2–1999Q1 | 1999Q2–2000Q1 | |
| Employment rate, 22– 59/64 years | 0.70 | 0.70 | 0.69 | 0.72 |
| Total actual weekly hours in main job | 34.6 (18.0) | 35.0 (17.9) | 40.4 (14.8) | 40.1 (14.5) |
| Total usual weekly hours in main job | 39.6 (13.5) | 39.5 (13.9) | 39.1 (12.7) | 38.7 (12.0) |
| Proportion of employed in minimum wage sector | 0.31 | 0.30 | 0.26 | 0.26 |
| Male | 0.51 | 0.51 | 0.52 | 0.52 |
| Age, years | 40.0 (11.3) | 40.2 (11.2) | 39.7 (11.3) | 39.8 (11.3) |
| Single | 0.27 | 0.27 | 0.32 | 0.33 |
| Married/cohabiting | 0.63 | 0.63 | 0.62 | 0.61 |
| Widowed/divorced | 0.05 | 0.05 | 0.06 | 0.06 |
| Number of children <18 years in household | 1.07 (1.27) | 1.04 (1.26) | 1.09 (1.32) | 1.05 (1.29) |
| Nobs | 11,366 | 11,552 | 220,795 | 219,934 |
[i] Notes: Estimates are weighted for nonresponse using pwt07 (QLFS) and gf (QNHS) and based on the full set of information available for each variable. Variables are defined in Table A1. Qualifications data for the RoI sample are not available over this period.
[ii] NI, Northern Ireland; NMW, National Minimum Wage; QLFS, Quarterly Labor Force Survey; QNHS, Quarterly National Household Survey; RoI, Republic of Ireland.
Table 3
Sample means (standard deviations) for outcomes and other observable characteristics, NI and RoI, pre and post the introduction of NLW
| NI | RoI | |||
|---|---|---|---|---|
| 2015Q4–2016Q1 | 2016Q2–2016Q3 | 2015Q4–2016Q1 | 2016Q2–2016Q3 | |
| Employment rate, 25–59/ 64 years | 0.76 | 0.76 | 0.73 | 0.73 |
| Total actual weekly hours in main job | 32.5 (16.6) | 33.6 (16.7) | 35.6 (13.0) | 36.8 (12.8) |
| Total usual weekly hours in main job | 37.5 (12.1) | 37.6 (12.6) | 36.5 (11.6) | 36.8 (11.4) |
| Proportion of employed in minimum wage sector | 0.31 | 0.30 | 0.32 | 0.32 |
| Male | 0.52 | 0.50 | 0.51 | 0.52 |
| Age, years | 43.0 (10.7) | 43.1 (10.7) | 42.5 (10.4) | 42.5 (10.4) |
| Single | 0.30 | 0.30 | 0.34 | 0.35 |
| Married/ cohabiting | 0.59 | 0.58 | 0.60 | 0.58 |
| Widowed/ divorced | 0.07 | 0.06 | 0.06 | 0.07 |
| Number of children <18 years in household | 0.91 (1.12) | 0.90 (1.13) | 0.97 (1.20) | 0.96 (1.20) |
| ISCED1 | 0.22 | 0.22 | 0.06 | 0.06 |
| ISCED2 | 0.22 | 0.20 | 0.11 | 0.12 |
| ISCED3–4 | 0.22 | 0.21 | 0.15 | 0.15 |
| ISCED5 | 0.08 | 0.09 | 0.13 | 0.12 |
| ISCED6 | 0.24 | 0.26 | 0.30 | 0.30 |
| Nobs | 3,430 | 3,832 | 42,170 | 41,961 |
[i] Notes: Estimates are weighted for nonresponse using pwt16 (QLFS) and gf (QNHS) and based on the full set of information available for each variable. Variables are defined in Table A1
[ii] ISCED, International Standard Classification of Education; NI, Northern Ireland; NLW, National Living Wage; QLFS, Quarterly Labor Force Survey; QNHS, Quarterly National Household Survey; RoI, Republic of Ireland.
Table A2
Full difference-in-differences estimates of impacts of the NMW introduction on employment and hours in NI, coefficients (standard errors)
| Employment | Weekly hours | |
|---|---|---|
| NI × post | -0.019*** (0.006) | -0.006 (0.007) |
| NI | 0.009** (0.004) | -0.024*** (0.005) |
| 1998Q3 | 0.005* (0.003) | 0.015*** (0.003) |
| 1998Q4 | 0.011*** (0.003) | -0.014*** (0.003) |
| 1999Q1 | 0.018*** (0.003) | -0.014*** (0.003) |
| 1999Q2 | 0.024*** (0.003) | -0.009*** (0.003) |
| 1999Q3 | 0.030*** (0.003) | 0.013*** (0.003) |
| 1999Q4 | 0.035*** (0.003) | -0.008*** (0.003) |
| 2000Q1 | 0.038*** (0.003) | -0.023*** (0.003) |
| Age | 0.029*** (0.001) | 0.003*** (0.001) |
| Age2 | -0.0005*** (0.00001) | -0.00006*** (0.00001) |
| Male | 0.263*** (0.001) | 0.350*** (0.002) |
| Number of children <18 years in household | -0.044*** (0.001) | -0.019*** (0.001) |
| Married | 0.044*** (0.002) | -0.037*** (0.002) |
| Divorced | -0.018*** (0.004) | -0.096*** (0.005) |
| Widowed | -0.028*** (0.006) | -0.102*** (0.009) |
| Constant | 0.226*** (0.010) | 3.42*** (0.011) |
| R2 | 0.135 | 0.146 |
| Nobs | 463,647 | 298,473 |
[i] Notes: ***Significant at 1%; **significant at 5%; *significant at 10%. Standard errors are robust.
[ii] NI, Northern Ireland; NMW, National Minimum Wage.
Table A3
Full difference-in-differences estimates of impacts of the NLW introduction on employment and hours in NI, coefficients (standard errors)
| Employment | Weekly hours | |
|---|---|---|
| NI × post | -0.001 (0.010) | -0.019 (0.012) |
| NI | 0.040*** (0.007) | 0.055*** (0.009) |
| 2016Q1 | -0.001 (0.004) | 0.035*** (0.006) |
| 2016Q2 | 0.001 (0.004) | 0.059*** (0.006) |
| 2016Q3 | 0.007* (0.004) | 0.061*** (0.006) |
| Age | 0.032*** (0.001) | 0.014*** (0.002) |
| Age2 | -0.0004*** (0.00002) | -0.0002*** (0.00002) |
| Male | 0.129*** (0.003) | 0.299*** (0.004) |
| Number of children <18 years in household | -0.038*** (0.001) | -0.029*** (0.002) |
| Married | 0.119*** (0.004) | 0.020*** (0.005) |
| Divorced | -0.006 (0.007) | -0.005 (0.011) |
| Widowed | -0.021 (0.014) | -0.049** (0.025) |
| ISCED 6 | 0.213*** (0.004) | 0.079*** (0.005) |
| ISCED 5 | 0.161*** (0.005) | 0.039*** (0.007) |
| ISCED 3–4 | 0.094*** (0.005) | 0.019*** (0.006) |
| ISCED 2 | -0.028*** (0.005) | -0.036*** (0.007) |
| Constant | -0.004 (0.028) | 3.02*** (0.038) |
| R2 | 0.099 | 0.085 |
| Nobs | 91,393 | 61,329 |
[i] Notes: ***Significant at 1%; **significant at 5%; *significant at 10%. Standard errors are robust.
[ii] ISCED, International Standard Classification of Education; NI, Northern Ireland; NLW, National Living Wage.
Table 4
Difference-in-differences estimates of impacts of the NMW introduction on employment and hours in NI, coefficients (robust standard errors)
| Employment | Weekly hours | |
|---|---|---|
| Constant treatment effect (1999Q2–2000Q1) | -0.019*** (0.006) | 0.001 (0.007) |
| Quarter-by-quarter estimates | ||
| 1998Q2 (pre-NMW) | Ref. case | Ref. case |
| 1998Q3 (pre-NMW) | -0.014 (0.012) | 0.001 (0.014) |
| 1998Q4 (pre-NMW) | -0.003 (0.012) | 0.007 (0.014) |
| 1999Q1 (pre-NMW) | -0.016 (0.012) | 0.020 (0.014) |
| 1999Q2 (post-NMW) | -0.025** (0.012) | 0.020 (0.013) |
| 1999Q3 (post-NMW) | -0.023* (0.012) | 0.010 (0.014) |
| 1999Q4 (post-NMW) | -0.028** (0.012) | 0.011 (0.014) |
| 2000Q1 (post-NMW) | -0.033*** (0.012) | -0.009 (0.013) |
| Nobs | 463,647 | 282,435 |
[i] Notes: ***Significant at 1%; **significant at 5%; *significant at 10%. Standard errors are robust. Covariates listed in Table A1 are included in the model, and full estimates for the constant treatment effects models are presented in Table A2.
[ii] NI, Northern Ireland; NMW, National Minimum Wage.
Table 5
Difference-in-differences estimates of impacts of the NLW introduction on employment and hours in NI, coefficients (robust standard errors)
| Employment | Weekly hours | |
|---|---|---|
| Constant treatment effect (2016Q2–2016Q3) | -0.001 (0.010) | -0.011 (0.011) |
| Quarter-by-quarter estimates | ||
| 2015Q4 (pre-NLW) | Ref. case | Ref. case |
| 2016Q1 (pre-NLW) | -0.002 (0.014) | -0.009 (0.016) |
| 2016Q2 (post-NLW) | -0.005 (0.014) | -0.009 (0.015) |
| 2016Q3 (post-NLW) | 0.0004 (0.014) | -0.023 (0.015) |
| Nobs | 91,393 | 61,551 |
[i] Notes: ***Significant at 1%; **significant at 5%; *significant at 10%. Standard errors are robust. Covariates listed in Table A1 are included in the model, and full estimates for the constant treatment effects models are presented in Table A3.
[ii] NI, Northern Ireland; NLW, National Living Wage.
Table 6
Difference-in-differences estimates of impacts of the NMW and NLW introductions on employment and hours in NI, heterogeneous effects, constant treatment effects, coefficients (robust standard errors; number of observations)
| NMW introduction | NLW introduction | |||
|---|---|---|---|---|
| Employment | Weekly hours | Employment | Weekly hours | |
| Baseline | -0.019*** (0.006) [463,647] | 0.001 (0.007) [282,435] | -0.001 (0.010) [91,393] | -0.012 (0.011) [61,551] |
| Men | -0.020** (0.008) [238,402] | 0.005 (0.007) [161,121] | -0.020 (0.013) [46,661] | 0.005 (0.012) [32,430] |
| Women | -0.019** (0.009) [225,245] | -0.006 (0.012) [121,314] | 0.018 (0.015) [44,732] | -0.027 (0.018) [29,121] |
| Age 22–34/ 25–34 years | -0.022** (0.010) [161,846] | 0.013 (0.010) [115,105] | -0.005 (0.019) [21,976] | -0.020 (0.019) [15,716] |
| Age 35–59/ 64 years | -0.019*** (0.008) [301,801] | -0.008 (0.009) [167,330] | -0.002 (0.012) [69,417] | -0.009 (0.013) [48,835] |
| Higher qualification level | – | – | -0.005 (0.012) [51,531] | -0.02 (0.012) [39,319] |
| Lower qualification level | – | – | -0.001 (0.018) [19,055] | 0.002 (0.023) [9,168] |
| (Share of those employed who are) employed in minimum wage sector | -0.008 (0.007) [322,021] | -0.011 (0.013) [75,607] | -0.018 (0.013) [66,462] | 0.011 (0.021) [19,439] |
[i] Notes: ***Significant at 1%; **significant at 5%; *significant at 10%. Standard errors are robust. Covariates listed in Table A1 – with the exception of the relevant dummy on which the sample is restricted – are also included in each model. The models are estimated under the parallel path assumption in each case.
[ii] NI, Northern Ireland; NLW, National Living Wage; NMW, National Minimum Wage.
Table 7
Sensitivity analysis, constant treatment effects, coefficients (robust standard errors)
| NMW introduction | NLW introduction | |||
|---|---|---|---|---|
| Employment | Weekly hours | Employment | Weekly hours | |
| Baseline | -0.019*** (0.006) | 0.001 (0.007) | -0.001 (0.010) | -0.011 (0.011) |
| Baseline as logit (marginal effects) | -0.020*** (0.006) | – | -0.0002 (0.011) | – |
| Exclude 1999Q1 | -0.022*** (0.007) | 0.006 (0.007) | – | – |
| Exclude 2015Q4 | – | – | -0.00001 (0.012) | -0.007 (0.014) |
| Exclude 2016Q1 | – | – | -0.002 (0.012) | -0.015 (0.013) |
| Total actual hours | – | -0.005 (0.008) | – | -0.018 (0.012) |
| Border region only | -0.010 (0.007) | 0.006 (0.008) | 0.014 (0.013) | -0.011 (0.015) |
| Estimated with wild bootstrap clustered standard errors (p-value) | -0.019*** (0.002) | 0.001 (0.656) | -0.001 (0.600) | -0.011*** (0.002) |
[i] Notes: ***Significant at 1%; **significant at 5%; *significant at 10%. Covariates listed in Table A1 are included in each model. Wild bootstrap standard errors are clustered at the NUTS 3 regional level.
[ii] NLW, National Living Wage; NMW, National Minimum Wage.