The Low Pay Commission has recommended to the government that the national minimum wage (NMW) should rise by 3% to £6.70 from October 2015.
If accepted by the government it would be the largest real terms rise in the NMW since 2007, given inflation is forecast at 0.5%. The current minimum wage stands at £6.50.
Association of Convenience Stores chief executive, James Lowman, said: “With inflation running at 0.5% and many prices in store going down, this cost increase will be another challenge for convenience stores particularly for those trying to take on more staff and grow their business.
“While we are concerned at the impact of this increase, we respect the Low Pay Commission’s work in balancing the needs of businesses, staff and the wider economy.”
David Norgrove, chair of the LPC, said: “Sharp increases in the minimum wage would put jobs at risk – not least bearing in mind pressure on low-paying sectors and small firms.
“We do believe however that the continued recovery, and in particular the impressive growth in employment of the low paid, should this year allow a further increase in the real and relative value of the minimum wage.”
The Low Pay Commission has also recommended an increase of 3.3% to £5.30 in the Youth Development Rate, which applies to 18-20 year olds; an increase of 2.2% to £3.87 in the 16-17 Year Old Rate; and an increase of 2.6% to £2.80 in the Apprentice Rate.