An Assessment of the impact of the introduction of the Apprentice Rate of the National Minimum Wage

A National Minimum Wage Apprentice Rate (NMWAR) at £2.50 an hour was introduced in October 2010 and increased to £2.60 shortly after.

IES was asked by the Low Pay Commission to deliver a research project on how the introduction of the NMWAR had affected important outcome variables. We undertook quantitative research combining descriptive analyses and impact assessments of the NMWAR introduction, in particular:

  • statistical analysis of the 'bite' of the NMWAR
  • descriptions of and impacts on levels and composition of apprentice pay and completion of apprenticeships.

Our study addressed the great difficulties in obtaining informative impact measures of the introduction of the NMWAR by applying evaluation methods (such as a difference-in-differences estimator), which estimate counterfactual outcomes and benefit from the relatively dissimilar regulation of apprentice pay in the different countries of the UK prior to its introduction.