The National Living Wage, announced in the 2015 Autumn Statement and effective from 1 April 2016, effectively takes control of the Minimum Wage out of the hands of the Low Pay Commission and gives it to the government.
Whereas the LPC had a mandate to balance both pay and employment concerns, free from political pressure, the issue is now politicised.
There are worries that abandoning this framework will threaten employment: the Office for Budget Responsibility projected last year that 60,000 fewer jobs will be created under this regime than the previous status quo.
This paper reviews the empirical evidence on the direct and indirect impacts of increases to the Minimum Wage.