Low Pay and Social Exclusion: A Cross-National Comparison

Low pay is recognised as one way in which individuals and households can suffer social exclusion since it is closely linked with issues of poverty (Sutherland, 1995), and discrimination (Naylor, 1994). The characteristics of the low paid, therefore, are important in policy terms to bodies like the new Low Pay Commission in Britain and the European Union's concerns with social exclusion. In addition the characteristics of the low paid reveal more about the workings of the labour market and how processes of social exclusion are generated and maintained. The extent of low pay has already been documented within individual countries (Dex et al., 1994; Hurstfield, 1987; Sloane and Siebert, 1980) and across European countries (CERC, 1992; Rubery and Fagan, 1994; Bazen and Benhayoun, 1992). The opportunity to perform extensive comparisons on a range of demand and supply-side characteristics across countries has arisen with the introduction of the harmonised data generated by the PACO (Panel Comparability) project. An earlier paper has examined the demand side characteristics of low paid workers from these data (Robson et al 1997). In this paper we set out to investigate whether low pay is associated with the same supply-side and household characteristics of workers in our diverse range of countries - Britain, Germany, Luxembourg, Spain and the USA. The characteristics of low paid workers are also examined using a multivariate logit model in order to identify the separate effects of these characteristics on the probability of being a low paid worker.