Autumn Statement - PwC comments on Minimum Wage rise

Anna Vishnyakov, Workforce Partner at PwC says:

“With the announcement that the National Minimum Wage is rising to £11.44 per hour from April 2024, the increase goes beyond the top of the range predicted by the Low Pay Commission (LPC) back in March 2023. This equates to a 9.8% increase.

“The Government has a key manifesto commitment for the National Living Wage to equal two-thirds of median earnings by 2024 for workers aged 21 and over, which this rise meets. It was not unexpected to be higher than the estimates in March due to the continued wage growth seen over the past few months. 

“This is welcome news to the estimated 1.6 million workers that are paid at minimum wage and especially welcome to workers aged 21 and 22 who will be entitled to the minimum wage from April 2024. Businesses are unlikely to have forecast this level of increase and will need to review their budgets for next year, including on-costs such as employer national insurance and pensions. In particular, businesses in retail and hospitality, who typically employ a younger and lower paid workforce, will be impacted.  

“Businesses will also need to consider their compliance with the National Living Wage, as not all pay counts for the purpose of calculating whether compliance with the National Living Wage has been met and certain deductions reduce pay for National Living Wage purposes.”