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National Living wage to increase by 6.2% in April 2020 – the biggest ever cash boost


Let’s ‘level up’

With a record number of people in full-time employment, the Government have improved the UK jobs market in the last decade. The minimum wage pay rise that will increase nearly three million wages in April 2020, is all part of the Prime Minister’s pledge to ‘level up’ the country and improve the living standards.

PM Boris Johnson said: ‘Hard work should always pay, but for too long people haven’t seen the pay rises they deserve. Our Government will put a stop to that, giving nearly three million people from Edinburgh to Eastbourne a well-earned pay rise, including the biggest ever cash boost to the National Living Wage.’

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Rise above inflation

Workers over the age of 25 will receive an annual pay rise of 6.2% from April 2020, which equates to an increase in gross annual earnings of around £920 for a full-time worker currently on the national living wage. Other age groups will also rise above inflation, which stood at 1.5% in November making the national minimum wage increase quadruple the level of the consumer price index (CPI).

The impact

The Government plan to increase the minimum wage for all employees aged over 21 to £10.50 an hour providing economic conditions allow, will come into effect by 2024. This proposal would see four million workers paid an average of £4,000 more a year, compared to now, at a cost of £16billion to employers. Business leaders, however, said the government risked damaging companies at a time of heightened economic uncertainty. With business rates to increase by 1.7% in April, small firms will need support from the government and possibly to reduce costs elsewhere. There is little to no evidence of job losses as a result of rising minimum wage levels from the previous increase. 

What is the real living wage? 

6,000 businesses have now joined a campaign designed by the Living Wage Foundation (also known as the voluntary living wage), which is separate from the government, to pay staff across the UK based on rising living costs. The foundation has said that the Government’s statutory wage is not high enough to meet the rising living costs across the UK. In London the rate is set at £10.75 an hour and outside the capital it’s £9.30.  


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