National minimum wage up 10%

National minimum wage up 10%

Apr 3, 2024

In a boost for workers and a headache for businesses, the national living wage hourly rate has risen to £11.44

Additionally, the national living wage will be extended so that it applies to workers aged 21 and over and to live in domestic workers. The increase will see rates rise by £1.02 an hour from the current £10.42 to £11.44 from 1 April.

This means that in the last three years the national living wage has increased by 28% from £8.91 in April 2021. Before 2021, workers had to be over 25 to even receive national living wage.

The national minimum wage applies to workers of at least school leaving age of 18, to 20, and will be £8.60 per hour, while the under 18 and apprentice rate will be £6.40 per hour.

The rapid increase in hourly rates has put pressure on businesses, with soaring costs and wage bills putting a squeeze on cashflow.

REC chief executive Neil Carberry said: ‘This year’s rise in the national living wage is far in advance of both wider wage rises and prevailing inflation. It will put significant strain on businesses in key sectors, notably those who sell directly to the consumer.

‘Many businesses will face choices over raising prices, changing working patterns or shorter opening hours as they try to adapt in the midst of a recession.

‘A politically driven minimum wage risks employment opportunities for the most vulnerable workers and the sustainability of many smaller local businesses, especially on our under pressure high streets.

‘It is vital that businesses understand that their suppliers, including REC members supplying a million temporary workers every day, also face this increase. Approaches which seek to offload rising temp minimum wages onto agencies are unsustainable. When the cost of labour rises, that rate needs to be passed on.’

The Chancellor Jeremy Hunt has recently indicated that the government plans to rein in future rises in the national living wage, which was driven up by the pandemic and the cost of living crisis.