Author Description

There has been extensive debate during the past few years in Australia about whether cutting minimum wages would help reduce unemployment, by generating new jobs that could be taken by the currently unemployed. There has also been debate, both in Australia and overseas, about whether increase in minimum wages would decrease family income inequality. Despite the importance of these issues, remarkably little is know about low wage workers. This paper analyses who are the low paid workers in Australia, establishes whether they live in low income households, identifies the sources of income for families with low wage workers, and looks at whether families with low wage workers are substantially over-represented among the poor. The analysis suggests that a substantial proportion of low wage workers live in families in the upper half of the income distribution - generally because they live in a family where another person also earns income. On the other hand, families with low wage earner are about twice as likely to be in poverty as are wage and salary families generally.