The British Retail Consortium (BRC) has called for a more transparent method of deciding new National Minimum Wage rates, more genuinely based on economics.
The calls come on the back of a report carried out by Oxford University and commissioned by the BRC. The report points out that the NMW has risen by 46% since its introduction in 1999, more than any of the economic indicators which should be influencing it.
The report also highlights the fact that in some sectors the NMW has risen enough to become the standard wage rate, resulting in less incentive among employees to improve skills. In the retail and wholesale sector, 75% of employees now earn no more than the NMW.
BRC director general Kevin Hawkins said: "This report shows the NMW has shot up way above any measure of average wage or productivity. That cannot be afforded any longer. Retailers cannot repeatedly absorb substantial increases based on subjective ideas of 'what feels right'."