The Chancellor has announced an increase in the national minimum wage for those aged 23 and over to £10.42
From April 2023, those on minimum wage aged 23 and over will see an increase by 9.7% from £9.50 to 10.42 an hour. This represents an increase of over £1,600 to the annual earnings of a full-time worker and is expected to benefit over 2 million low paid workers. The Low Pay Commission’s (LPC) recommendations ensured that the national living wage continues on track to reach the government’s target of two-thirds of median earnings by 2024. Bryan Sanderson, low pay commission chair, said: ‘The rates announced today include the largest increase to the NLW since its introduction in 2016 and will provide a much-needed pay increase to millions of low-paid workers across the UK, all of whom will be feeling the effects of a sharply rising cost of living. For a full-time worker, today’s increase means nearly £150 more per month. ‘The tightness of the labour market and historically high vacancy rates give us confidence that the economy will be able to absorb these increases.’ The national living wage rates will increase by 10.9% for those aged 21-22 years old to £10.18 an hour, 9.7% for 18-20 year olds to £7.49 an hour, and 9.7% for 16-17 year olds to £5.28. David Menzies, director of practice at ICAS, said: ‘The increase in National Minimum Wage to £10.42 will be welcomed by the lowest paid members of society at a time when day to day living costs are increasing substantially. This represents an approximate 10% increase on the current top rate. ‘For many businesses however, particularly in sectors such as hospitality and tourism or where profit margins are already small, the above inflation increase at the same time as general staff shortages, rising direct costs and supply chain issues, could make all the difference to the business ongoing viability. ‘Business owners should be taking steps to forecast through the impact of all such factors and take professional advice at an early stage.’
