New Minimum Wage Rate Approved

The government today announced the National Minimum Wage (NMW) rate will rise from £5.52 to £5.73 from October 2008.  The NMW, which has risen some 59% since its introduction in 1999, has benefited workers, but has sometimes been a source of anxiety for employers in some sectors.

Nevertheless, predictions of job losses and struggling businesses as a result of the NMW have not come to fruition.  This year’s increase does not go above the level of inflation and small business groups have welcomed today’s announcement, with the Federation of Small Businesses saying:

We are pleased that the Government and the Low Pay Commission have heeded the FSB’s past concerns when increases were well above the rate of inflation.  A sensibly set National Minimum Wage is in the interests of both employers and employees.

The rate for 18-21 year olds will rise to £4.77 and for 16-17 year olds to £3.53.

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