In April 2019 over 2 million workers aged 25 and over will see their pay rise, as National Living Wage increases to £8.21 an hour. This means that the nation’s lowest paid, full-time workers will receive an annual increase of £690 – ensuring that their wages will exceed inflation and average earnings.
Next month, the minimum wage for those aged 16-24 will also go up, while the pay for apprentices will go up by an extra 20p an hour.
|Year||25 and over||21 to 24||18 to 20||Under 18||Apprentice|
|April 2018 (current rate)||£7.83||£7.38||£5.90||£4.20||£3.70|
Philip Hammond announced these changes back in October with the government claiming that it signalled the end of austerity. But after next month what will the pay increase really mean for you and I?
It will no doubt be a welcome boost in earnings for young people across the UK but arguably the higher rates will still be below the voluntary Living Wage of £10.20 an hour in London and £8.75 in the rest of the UK.
Businesses will feel a further squeeze on costs and some may feel that the increase will simply mean labour is unaffordable, perhaps resulting in fewer job opportunities.
As it stands the labour market is robust and the economy, whilst subdued, continues to grow. Although record levels of employment exacerbate skills shortages, the UK is continuing to produce a record number of jobs. It will be interesting to see the actual impact these changes will make over the coming financial year.