Can more inclusive wage‐setting institutions improve low‐wage work? Pay trends in the United Kingdom's public‐sector hospitals

International research findings highlight the important role of institutions in shaping the wage structure of an economy. Evidence from a sample of seven public hospitals in the United Kingdom confirms those findings, suggesting that a more coordinated and centralized system of wage‐setting (including extension of public‐sector conditions to outsourced workers) improves pay for low‐wage cleaners and assistant nurses. Renewal of wage‐setting institutions provides a necessary but insufficient foundation for the elimination of low‐wage work. Employee investment in skill development, career advancement and skill‐based pay require management's commitment to the design of new, higher‐skilled jobs and the strengthening of internal labour markets.