Back in July this year, the Government announced that the National Minimum Wage Rates (Were) Set To Rise 2%. Now we’ve reached the set deadline and the proposed changes are taking place.
The national minimum wage has risen to:
- £5.93 an hour for people aged 21 and over
- £3.57 an hour for 16 and 17 year olds
- £4.92 an hour for 18 to 20 year olds; and
- £2.50 an hour for apprentices under 19.
(The original national minimum wage rates (and information on other statutory rates of pay) can be seen in our previous article “Minimum Wage and Statutory Pay Schemes”)
Potential Impact On Small Businesses
Of course the younger members of the working community will only be too pleased with the increase in their potential pay packet. But with the current state of the economy, the increase might mean difficulties for small business.
The British Retail Consortium in particular, is worried that if this trend continues into 2011, with another raise in the national minimum wage, then it could “seriously impeded retailers’ ability to maintain and create jobs”. (see “MINIMUM WAGE RESTRAINT NEEDED TO PROTECT JOBS”)
Higher rates of pay, even minimum wage, will mean higher operating costs for small businesses. This in turn might mean job cuts or at least reduction in potential new positions in the job market. The retail sector won’t be the only industry effected and new limited companies and small businesses employing staff will have to give serious consideration to their operating costs.
If you wish to find ways to keep costs down and run a tax-efficient limited company, why not get in touch with the UK’s leading Company Formation agent and see how we can help you get the most out of your business funds.
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