ACS (the Association of Convenience Stores) has warned the Chancellor about the negative effects of the new National Living Wage (NLW) increase.
Yesterday (29th October), the Chancellor announced a pay rise for over 3 million workers next year, with NLW rates rising by 6.7%. From April 2025, the following changes will come into effect:
- NLW will increase from £11.44 to £12.21
- 18-20 National Minimum Wage will rise by £1.40 per hour to £10 – the largest increase on record – and marks first step towards a single adult rate.
ACS chief executive James Lowman said: “Our members are grappling with how to afford this inflation-busting increase in wage costs. The market remains tough, with many retailers reporting flat or declining sales while expenses like banking charges, credit card processing fees and energy bills are eating away at their profitability.
More than ever, we need help from the Chancellor in the Budget. Without sustained and enhanced help on business rates, a reduction in National Insurance Contributions, and effective incentives to drive investment, our sector faces a challenging future. For some communities, this could mean the viability of their local shop is put at risk.”
Evidence provided to the Low Pay Commission by ACS earlier this year already found that to handle the increases in national wage increases, 53% of retailers have reduced the amount they invest in their business, 53% have been forced to increase their prices in store, and 47% have had to take lower profits. Baroness Philippa Stroud, Chair of the Low Pay Commission (LPC), stated that data already shows signs of employers finding it harder to adapt to minimum wage increases.
To find out more information about the NLW increase, you can visit gov.uk at https://www.gov.uk/
