The Government has accepted the Low Pay Commission’s (LPC) recommendation to raise the adult wage from Â£6.08 to Â£6.19 an hour. Youth rates will stay at Â£4.98 for 18–20 year olds and Â£3.68 for 16–17 year olds. The minimum pay for apprentices has, however, increased by five pence from Â£2.60 to Â£2.65 per hour.
The Confederation of British Industry has welcomed the announcement, arguing that it will support many businesses across the country.
“With youth unemployment at its highest level for a generation, we must take great care not to price young people out of a job. Freezing the minimum wage will help reduce one of the barriers to employers deciding whether or not to take on a young person,” commented Katja Hall, CBI Chief Policy Director.
Business Secretary, Vince Cable, agreed. He said: “In these tough times freezing the youth rates has been a very hard decision – but raising the youth rates would have been of little value to young people if it meant it was harder for them to get a job in the long run.”
Although the LPC was unanimous in its decision; Chair of the Commission, David Norgrove, believes that it struck the right balance between the needs of workers and the challenges facing employers.