Minimum wage increased by 6.2 per cent in "the biggest cash increase ever"
An increase in the minimum wage of 6.2 per cent came into effect today and has been heralded as "the biggest cash increase ever" by the government.
The rise takes hourly pay for those aged 25 and above to £8.72. It is more than three times the rate of inflation.
The raise has been applauded by unions across the country, as numerous workers are on reduced pay as a result of the coronavirus lockdown.
The job retention scheme introduced by the government means that employers are able to claim 80 per cent of wages to keep staff on, in spite of the pandemic.
TUC General Secretary Frances O’Grady said that: "Britain is indebted to its army of minimum wage heroes.
"Many - including care workers and supermarket staff - are currently on the frontline of the battle against coronavirus. They deserve every penny of this increase, and more."
However, employers worry that an increase in the minimum wage will result in higher unemployment as they will be forced too lay off workers to be able to afford the increases.
An independent report published in 2019 noted that there was little correlation between job loss and an increase in the minimum wage.
Mike Cherry, national chairman for the Federation of Small Businesses, said that: "Employment costs have surged in recent years and are cited as the number one cause of rising outgoings among small employers.”
He noted that the government policy to reduce National Insurance contributions paid by firms should provide sufficient leeway to increase wages.