Supporters of the idea, which could link benefits to local housing costs, say it would give more incentive for people in low wage areas to get a job.
BBC: MP Adrian Sanders warns on regional benefits system
But it would do so by removing the incentive to provide the low-wage jobs that the benefits were meant to encourage.
ECONOMIST: Labour��s wage policy
Instead of creating jobs, in-work benefits combined with a minimum wage would merely give firms an incentive to cut pay to the minimum.
The hitch is that, once this credit is in place, companies would have little incentive to offer health insurance to their low-wage workers.
ECONOMIST: Health-care promises
But paying in-work benefits also creates an incentive for firms to cut wages, as the state's wage top-up will ensure their workers are no worse off.
Single, low-skilled men therefore face a lower effective real wage than low-skilled women with children and have less incentive to work.
ECONOMIST: America's jobless men: Decline of the working man | The
应用推荐
模块上移
模块下移
不移动