Over 3 million workers will receive a pay boost after the
Chancellor confirmed the National Living Wage will increase from
£11.44 to £12.21 an hour from April 2025.
The 6.7% increase – which is worth £1,400 a year for an eligible
full-time worker – is a significant step towards delivering the
manifesto commitment to make sure the minimum wage is a genuine
living wage.
The National Minimum Wage for 18 to 20-year-olds will also rise
from £8.60 to £10.00 an hour – the largest increase in the rate
on record. This £1.40 increase will mean full-time younger
workers eligible for the rate will see their pay boosted by
£2,500 next year. This marks the first step towards aligning the
National Minimum Wage and National Living Wage to create a single
adult wage rate, which would take place over time.
The move comes ahead of the Budget tomorrow which will fix the
foundations to deliver change by fixing the NHS and rebuilding
Britain, while ensuring working people don't face higher taxes in
their payslips.
It builds on the commitment to be a pro-business, pro-worker,
pro-growth Government - delivering a key plank of the Plan to
Make Work Pay, which is already set to boost the pockets of the
lowest-paid workers by up to £600 a year through the Employment
Rights Bill.
The plan will boost productivity, creating a workforce that is
fit and ready to help us deliver our first mission to kickstart
economic growth – with good jobs and growth in every part of the
country making everyone, not just a few, better off.
Chancellor of the Exchequer said:
“This Government promised a genuine living wage for working
people. This pay boost for millions of workers is a significant
step towards delivering on that promise.”
Business Secretary,
said:
“Good work and fair wages are in the interest of British business
as much as British workers.
“This government is changing people's lives for the better
because we know that investing in the workforce leads to better
productivity, better resilience and ultimately a stronger economy
primed for growth.”
Deputy Prime Minister, said:
“A proper day's work deserves a proper day's pay.
“Our changes will see a pay boost that will help millions of
lower earners to cover the essentials as well as providing the
biggest increase for 18–20-year-olds on record.”
The minimum hourly wage for an apprentice is also boosted next
year, with an 18-year-old apprentice in an industry like
construction seeing their minimum hourly pay increase by 18.0%, a
pay bump from £6.40 to £7.55 an hour.
These increases will mean 3.5 million workers will receive a pay
rise this year in total. They confirm the Low Pay Commission's
recommendations, whose advisory remit was overhauled by ministers
in July to consider the cost of living.
Ethics Director at Lush Cosmetics, said:
"Lush staff making and selling our products are crucial to our
success, so we commit to the Living Wage Foundation's
independently calculated real living wage rates each year to feel
confident our rates of pay are fair and that our staff can afford
what they need to thrive, not just survive. In these tough times
where the cost of living continues to rise, it is great to see
the Government increase minimum wage closer to these calculations
to support the hardest working and most vulnerable workers across
the UK.”
Chair of the Low Pay Commission, Baroness said:
“The Government have been clear about their ambitions for the
National Minimum Wage and its importance in supporting workers'
living standards. At the same time, employers have had to deal
with the adult rate rising over 20 per cent in two years, and the
challenges that has created alongside other pressures to their
cost base.
“It is our job to balance these considerations, ensuring the NLW
provides a fair wage for the lowest-paid workers while taking
account of economic factors. These rates secure a real-terms pay
increase for the lowest-paid workers. Young workers will see
substantial increases in their pay floor, making up some of the
ground lost against the adult rate over time.”
Notes to editors
- National Minimum and Living Wage rates are recommended by the
Low Pay Commission to the government following a series of
business consultations and evidence sessions. These
recommendations are based on stakeholder engagement from workers,
unions, business and BRO's. The government can choose to accept
or reject these rates.
- The Department for Business and Trade estimate over 3 million
workers will directly benefit from the 2025 National Living Wage
increase, nearly 200,000 workers will directly benefit from the
increase to the National Minimum Wage for 18–20-year-olds, and
over 130,000 workers will benefit from the uplifts to the rate
for apprentices and those aged under 18.
