In case you missed it, the Labour party has announced plans to link the minimum wage to median earnings. At present, the level of minimum wage is recommended by an independent body: the Low Pay Commission. The government then chooses whether or not to accept the recommendations. Labour’s plans would result in an increase in the minimum wage that is directly in line with an increase in earnings. Labour has yet to announce the precise percentage of median earnings that minimum wage will be pegged to, but it is expected to be at around 60%.
The proposed change aims to bridge the gap between minimum wage and the living wage – and of course, win over voters in time for next year’s election. Business leaders have expressed concern about Labour’s plans, stating that it would have a disproportionate impact on local businesses, and could lead to an ‘arms race’ as parties try to outdo each other by promising the highest minimum wage.
The Association of Convenience Stores (ACS) claims that 87% of retailers have reduced staff hours due to increasing employment costs, and three-quarters of stores have held back investment and expansion plans. While larger firms may be more equipped to absorb employment costs, for small retailers, they are likely to make up a larger proportion of overall costs.
Retail accounting and point-of-sale software is likely to assist store managers and owners in reducing costs, hopefully preventing staff hours from being cut in the event of an increase in minimum wage. Here at Integrity Trader, we keep a close eye on the latest retail news affecting the industry, either today or in the future.
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