The Government has announced its acceptance of the Low Pay Commission’s recommendations on minimum wage rates, meaning there will be a 9.8% increase to the national living wage from April 2024, therefore, the compulsory rate of hourly pay will increase from £10.42 to £11.44.
In addition to this, the Government has also lowered the age at which people qualify for the national living wage, from 23 to 21. This means that people who are aged 21 and 22 will see a 12.6% increase in their pay, going from £10.18 to £11.44.
Younger people will also see a pay increase from April 2024, with 18 to 20-year-olds set to see an increase of 14.8% to £8.10, and 16 to 17-year-olds and apprentices will receive an hourly rate of £6.40 (21.2% increase).
Chair of the Low Pay Commission, Bryan Sanderson, commented:
“The national living wage has delivered an improved standard of living to thousands of people who care for our children and elderly, work in farms and shops and at many other essential jobs. These efforts over the lifetime of the NLW mean over £9,000 p.a. more to a full time worker without any increase in unemployment.
This hasn’t been easy for employers, with the economy facing a range of unprecedented challenges in recent years. The high degree of political and economic uncertainty has made assessing and forecasting the performance of the economy, and therefore our task, very difficult.
“Our new recommendation of a national living wage of £11.44 attempts to steer a path through this uncertainty and achieve the government target of two-thirds of the median wage, an outcome which if accepted would position the UK at the forefront of comparable economies.”
The Recruitment & Employment Confederation’s Deputy Chief Executive, Kate Shoesmith, added that the increase takes into account both the cost of living crisis and the considerably slow path of pay growth over the last 10 years or more.
Comment on the national living wage increase and how it may affect employers and employees
It will be difficult and challenging for some employers to adjust to the changes. However, having an increased pay rise for employees will make jobs like hospitality, retail, and care seem like a better option, especially when data shows over two million job vacancies in the UK.
Not only is money a factor for employees now, but flexible working is also a massive factor, such as many job seekers will not apply for a job unless it offers flexible working, this should be a reminder to employers that people need the best of both worlds.
The Government has been put under extreme pressure to improve working conditions and make sure that all jobs are well-paid. Therefore, this announcement is important for workers who are struggling to make ends meet.
There is no doubt however that this will be difficult for some employers, depending on how well their business is doing as employers with workers on zero-hour contracts may be forced to offer fewer working hours on the increased wage, which means that, while the hourly rate increases, it won’t necessarily translate to people earning more money than they did previously.
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