September 22 ,2014 | by Hari Sri

Business leaders call for UK minimum wage rise

UK minimum wage rise

A group of business leaders have called for a higher minimum wage, and unions have welcomed the news.

The UK introduced the National Minimum Wage as a means of protecting low-paid workers and ensuring a basic minimum income for the nation’s employees. Not every business supported the move when it was first introduced, amid concerns that it would drive up operating costs and damage the fortunes of the company – but as it has become entrenched in the labour market, it’s hard to imagine Britain without it.

 

Next month the minimum wage rises to £6.50 per hour for those aged 21 and over – a three per cent increase that represents the biggest jump in take-home pay since 2008.

But wages in the UK have not kept up with inflation since the financial crisis, and living costs have become tighter for many households. A group of senior business leaders have even signed a letter last week (18 September) calling for a much bigger jump in the basic rate of pay.

Co-signed by Sir George Bain, former chair of the Low Pay Commission, and a number of other leaders including Sir Ian Cheshire, chief executive at Kingfisher Group, chairman of Stobart Group Iain Ferguson and other senior figures in major UK businesses, the letter calls for faster increases in the minimum wage now the UK is growing economically.

 

The signatories acknowledge that it was the right decision for the Low Pay Commission to take a cautious approach during the economic downturn and not recommend particularly large increases.

However, now that growth is on the agenda, “a stronger minimum wage will benefit businesses, improve public finances, and help tackle low pay.”

“The economy is growing again,” they write. “But we must ensure that all employees are benefiting from the recovery – especially the lowest paid in society who find it hardest to make ends meet.”

Trade unions have welcomed the move, agreeing that the move is good for workers and businesses alike.

Frances O’Grady, general secretary of the Trade Union Congress (TUC), said: “There’s an overwhelming consensus forming that the time is now right for a much bigger increase in the minimum wage. It’s not only workers and their families who need it, getting money back into people’s pockets will give businesses the customers they need for sustained growth.”

Hari Sri

Hari is the LSBF Blog's News Editor. He manages the editorial content on the blog and writes about current affairs, SME, entrepreneurship, energy, education and emerging market news.

Share on Facebook Share on LinkedIn +1
There are no comments posted yet. Be the first one!
Please write your comment, minimum length 50 characters
Please insert your name
Please insert a correct email address
We couldn't process your comment, please try again later