Skip navigation

Gloucestershire Business News

Federation of Small Business chief warns about unaffordable minimum wage rise

The Federation of Small Business has warned that increases to the national minimum wage must be affordable to smaller business.

The Government has today launched a review in to the rates of the minimum wage, which rose from £7.83 to £8.21 per hour in April for over-25s.

Workers aged 21-24 saw their hourly rate increase from £7.38 to £7.70 with 18-20s rising from £5.90 to £6.15.

The Government has launched a review into those rates, with the chancellor of the exchequer commissioning professor Arin Dube to lead the investigation.

However, national chairman of the FSB, Mike Cherry said that small businesses must not be priced out of the market by rates that will end up affecting economic growth negatively.

He said: "Over 90 per cent of small businesses have maintained pay levels or increased them over the past year.

"Small firms tend to be ahead of the curve on pay: six in ten were paying all employees at least the National Living Wage rate for last year prior to April.


Click here to get Punchline Daily, the best Gloucestershire news delivered to your inbox

"However for some small businesses - particular those in sectors with lower levels of pay and tight margins such as social care - wage increases do take their toll.

"Firms are having to cut profitability, hold back investment and put up prices to absorb them. This review must recognise that fact.

"Small businesses are also contending with rising business rates, increasing pension costs and higher input costs due to a weakened pound.

"For firms in the retail, hospitality and care sectors in particular, these burdens are threatening futures.

"It's important to remember that wage increases are one of many government interventions that have collectively added £60,000 to the average small business cost of doing business since 2011.

"Therefore, it is essential that increases in the NLW are affordable for smaller businesses and do not have a chilling effect on economic growth."

Related Articles

Versarien's revenues halve and losses rise Image

Versarien's revenues halve and losses rise

Forest of Dean-based advanced engineering group Versarien saw its revenues halve last year.

Gloucestershire company launches same-day service Image

Gloucestershire company launches same-day service

Gloucester-based Freemans Event Partners has launched a brand-new around-the-clock foodservice logistics offer.

Gloucester business expands at Elmbridge Court Image

Gloucester business expands at Elmbridge Court

Just three offices are now available for rent at Elmbridge Court, following the latest letting.

Cirencester town centre to deliver improved parking Image

Cirencester town centre to deliver improved parking

Better parking and traffic control improvements for Cirencester residents and businesses.

Copyright 2024 Moose Partnership Ltd. All rights reserved. Reproduction of any content is strictly forbidden without prior permission.