earn and low pay roi ssisi cork 140416
TRANSCRIPT
Dr Micheál CollinsNERI (Nevin Economic Research Institute)[email protected]
@ MLGCollinswww.NERInstitute.net
Earnings and Low Pay in the Republic of Ireland
Statistical and Social Inquiry Society of IrelandCork, 14th April 2016
Outline1. Introduction2. Context3. Data4. Earnings5. Hourly Earnings & Low Pay6. Modelling Low Pay7. Conclusion
1. Introduction• NERI research project on incomes and low pay
o QEO Spring 2015 (& 2016)…
• Limited understanding of earnings (of all types)
• Few detailed examinations of low pay (recently)o including the MW
• Relevant to know:o for policy formationo for measuring progress etc
2. Context• Increasing interest in earnings:
o Recoveryo Literature on segmentation/polarisation etco Low Pay Commissiono Sustainability of redistributive system (tax & welfare) to
smoothen the income distribution• direct income disposable income• relevance of changes to the pre-distribution• not looked at for a while
• Literatureo Blackwell (1989), Nolan (1998), Barrett et al (2000)o MW related / OECD annual estimates on low pay…
• Throws up some research questions around:o The structure and distribution of earningso The low paid:
• how many• who• where
3. Data• CSO SILC 2013 (released January 2015)
o Sample of 4,922 households and 12,663 individualso Detailed income data (direct, gross, disposable)o Income data cross checked with tax and welfare recordso Detailed socio-economic characteristicso Weights for non-response etco Never perfect, but…o Earners
• 4,449 earners• 3,825 receive employment income• 654 self employment income• 3,369 employees whose PES = at work
o normal monthly gross earnings in main job & normal hrs per week
• Market income or ‘direct income’
• leaving out employers PRSI contributions• pensions…• Looking at:
o all individuals aged 17 years or moreo excluding those with no market income
4. Earnings • x3
o Overallo Employeeso Self Employed
• Charto each bar = €1,000 range of incomeo height = no of individualso merge all those with €150,000+
80% 20%
15%
15% 50%
15% 50%Top 10%
15% 50%Top 10%
Top 5%
Gini Coefficient = 48.99
5. Hourly Earnings & Low Pay• Looking at hourly earnings data for employees• Data:
o PES = at work and who are employeeso gross monthly earnings & no. of hours usually workedo main job
• Three thresholds:o Minimum wage of €8.65 per hour (2013)o Living Wage of €11.45 per hour (2014) = 66% median
o Low Pay Threshold €12.20 per hour (2010)
Approximately:
• 345,000 employees below €11.45
• 400,000 employees below €12.20
Who are the low paid? (incidence)
o Of all those who are low paid:• 60% women• 35% aged 18-29; 28% 30-39yrs; 17% 40-49yrs…• 24% in wholesale and retail sector• 18% in accommodation and food sector• 43% work 35hrs+ ; 26% work less than 20hrs• 82% permanent contract• 50%/50% split across full-time and part-time
Who is most likely to be low paid? (risk)
o Of all employees who are:• male 21% are low paid; female 29%• aged 18-29 = 53%; 60yrs+ = 25%• Sectors:
o Agri, forestry, fishing = 65%o Accommodation and Food = 61.5%o Admin and Support Services = 52%o Wholesale and retail = 43%
• low hours = 49%• Temporary contract = 48%• In poverty = 59% are low paid
Living Standards and the Income Distribution
All Employees The Low PaidLiving below the poverty line 3.2% 7.4%Difficulty making ends meet 27.5% 35.9%Unable to afford unexpected costs 45.9% 66.1%Borrowing for ordinary living expenses over last year
15.2% 20.7%
Experiencing Deprivation 19.4% 31.6%
from Table 8: Distribution of those at Work by decile, 2013
from Table 8: Distribution of those in Low Pay by decile, 2013
6. Modelling Low Pay• Concluding section of the paper• Getting a little deeper• Logit where dependent variable is earning less than
€12.20 per hour
• Findings:o Risk of low pay higher for:
• temporary contract workers• women• private sector workers• younger workers (non-linear effect for age)
o Risk of low pay lower for:• part-time• household with children• Dublin based workers• firms of 10+ employees
o no effect:• low hours
o Splitting into high-income & low-income, but limited difference
7. Conclusion• Some policy implications/relevances:
o structure of worker incomeo taxation policyo the starting point for redistribution (direct income)o the effectiveness of the minimum wageo effectiveness of interventions for low income working
families?o firm size & temporary contracts
• Raises questionso women and young people….
Dr Micheál CollinsNERI (Nevin Economic Research Institute)[email protected]
@ MLGCollinswww.NERInstitute.net
Earnings and Low Pay in the Republic of Ireland
Statistical and Social Inquiry Society of IrelandCork, 14th April 2016