The Low Pay Commission has recommended a 3% increase in the National Minimum Wage, which would take the adult rate to £6.50 per hour.
The LPC’s recommendation will not automatically become government policy, although a number of ministers, including Chancellor George Osborne, have recently spoken out in favour of a rise in the minimum wage.
Business secretary Vince Cable yesterday told MPs in a committee session that he was “not announcing here the government’s decision on the minimum wage rate, but it seems appropriate to bring the committee up to date with where we currently are within that process”.
Association of Convenience Stores chief executive James Lowman voiced concerns over the potential increase and its impact on jobs and business investment.
“We are disappointed that the Commission has recommended an increase in the national minimum wage above inflation, above average earnings growth, and above public sector pay award levels,” he said.
“Our research has clearly shown that retailers have little choice but to reduce staff hours and delay further business investment when the minimum wage is increased.”
The 2013 ACS Minimum Wage Survey showed that 87% of retailers have reduced staff hours within their business as a result of increases in employment costs, while 75% have delayed expansion and investment plans.
The ACS recommended a freeze in the minimum wage in its submission to the Low Pay Commission.