UK Autumn Budget 2021: Minimum Wage Set to Rise For All Ages
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The UK minimum wage is set to increase to £9.18 in the Autumn Budget.
HM Treasury confirmed the 9.8% increase in the minimum wage for all persons aged 22 years and above on Monday ahead of the Chancellor of the Exchequer Rishi Sunak’s announcement on Wednesday October 27.
This means that millions of UK workers will get a pay rise in 2022 following intense campaigns by the Living Wage Foundation.
The 82p increase in the hourly rate means that full-time workers on minimum wage will get a pay rise of more than £1,000 per year.
Note that this increase in minimum wage is double the inflation rate in consumer prices that currently stands at around 3.1%.
Workers aged 23 years and above will see their living wage increase from by 6.6% to £9.50 an hour , the Treasury said.
Apprentices also have something to look forward to in the Autumn budget as they are also set to get a significant pay increase, with their minimum wage increasing by 51p from £4.30 to £4.81.
According to the Government, apprenticeships are a “key part of our Plan for Jobs.”
Moreover, younger workers are not working as apprentices will also see smaller increases in their wages. HM Treasury reveals that the workers under 18 years of age will see their wages increase from £4.62 to £4.81, a 19p hourly increase.
The Chancellor is due to confirm the increase in minimum wage as he lays out the government’s tax and spending plans in the Autumn Budget on Wednesday even as the UK economic recovery slows and inflation surges.
It is worth noting that the National Living Wage, which previously applied on only those aged 25 years and above was extended to include 23 and 24-year-olds in April this year.
The UK government has said it remains committed to meeting its target of the National Living Wage reaching two-thirds of median earnings and expanding it to include workers aged 21 years and above by 2024, provided the prevailing economic conditions allow.
Several industry leaders have had different opinions on the increased in the Living Wage and Minimum Wage rates. For example, the head of people policy at the British Chambers of Commerce, Jane Gratton warns that business are facing a “cashflow squeeze”. She said:
“While businesses support the minimum wage, the size of this increase – with less than six months’ notice – will cause significant concern, especially with so many smaller firms already struggling. There is a limit to how much more firms can continue to absorb rising costs before they have to raise their own prices adding to inflationary pressures. It is therefore vital that companies are not faced with any further up-front costs for the remainder of this Parliament.”
On the other hand, the Living Wage Foundation’s director, Graham Griffiths welcomed the idea calling on employers to “commit to go beyond this new government minimum, do the right thing, and commit to pay a real living wage”.
