The government has recently announced plans to increase the official minimum wage at 6.2 per cent in April which has been labelled “the biggest cash increase ever” at four times more than the rate of inflation.
The move was unveiled almost immediately after Boris Johnson won the general election in a bid to encourage support from low-paid workers after typically working class areas in the North East and Midlands voted Conservative for the first time.
Nearly 3 million employees throughout Britain will benefit from the increase as hourly pay is due to increase to £8.72 for those over the age of 25 equal to an extra £930 a year.
Younger individuals will also receive a slightly lower increase of between 4.6 per cent and 6.5 per cent, with those aged 21-24 receiving a 6.5 per cent increase from £7.70 to £8.20 an hour.
The Prime Minister has justified the growth by saying: “Hard work should always pay, but for too long, people haven’t seen the pay rises they deserve.”
The TUC general secretary, Frances O’Grady, said the rise was long overdue. “Workers are still not getting a fair share of the wealth they create, and in-work poverty is soaring as millions of families struggle to make ends meet,” she said. “No more excuses, working families need a £10 minimum wage now, not in four years’ time.”
The Federation of Small Businesses (FSB) said “an increase of this magnitude” could result in companies employing less people, cancelling investment plans and considering redundancies due to the increase in costs.