New National Living Wage in UK – Hurray!

The new wage came in last Friday for employees over 25:-  the Minimum Legal Wage is now £7.20 per hour, which is higher than the Standard Minimum Wage for young people aged 21 – 34. By 2020 the Living Wage will be £9 per hour.  Confused?  So are we! Apparently the Office for budget Responsibility thinks unemployment could be 60,000 high by 2020 because of the new Living Wage.

Of course firms could pass on higher prices due to increased wage costs – in other words, the cost of living would go up. The higher wage is something London already has under its belt to some degree due to the higher cost of living.  Northerners may benefit from it more than Southerners therefore.

The firms who do not pay well = retail, catering and social care will be “hit” the hardest by this new minimum.  The new wage could also attract even more people to working in the UK than before.  “Economic migrants” will come to make a profit!

Some firms may deal with the new quota by reducing staff numbers.  Firms will always find a way round making a loss whilst their employees make a gain.  C’est La Vie!

Penny Nair Price