The latest hike in the National Minimum Wage (NMW) will further stifle job creation within the convenience store sector, retailers have warned.
On October 1, the adult rate for 21-year-olds and over increased from £6.08 to £6.19, while the hourly rate for apprentices increased from £2.60 to £2.65 per hour. The rates for workers aged 18-20 and 16-17 remain at £4.98 and £3.68 respectively.
Gordon Crump of Spar Compton, Wolverhampton, said that rising wage costs had prevented him from hiring more staff. “We haven’t been forced to cut hours yet, but the increased rate means we can’t take on or replace staff when they leave,” he said. “We have 40 staff and would like to employ more, but we can’t afford to. It’s a shame because we get people coming in every day looking for work.”
Paul Wilks of Budgens Bedgrove in Aylesbury, Buckinghamshire, pays above the minimum rate, but is concerned that it will keep increasing. “We won’t have to let staff go or cut hours yet, but if the increases keep coming and are higher than inflation we’ll have to look at rotas.”
An Association of Convenience Stores (ACS) survey found that, on average, most retailers paid staff 1.6% above the national minimum wage rates in 2011/2012. This has decreased significantly from the 2011 ACS National Minimum Wage survey, when retailers were paying 2.2% above the minimum wage rate.
“No retailer wants to be a minimum wage employer. However, year after year the difference between the average base rate of wages for retail staff and the statutory minimum wage gets smaller,” ACS chief executive James Lowman said. “This causes businesses to have to cut back on staff hours and delay investment plans.”
As part of the 2013 remit for the Low Pay Commission, the government has asked that the rates help as many workers as possible while not damaging employment prospects.
“It’s just another slice off the bottom line for us. We’ll have to look at the rotas to see where we can save, but we don’t want to have to cut anybody’s hours if we can help it.”
Londis Lindford, Hampshire
“We can absorb the increase this time around, but if it continues to rise at the same rate we’ll be forced to look at those areas where we can save.”
Budgens, Hassocks, West Sussex
“From a staff point of view the increase is a good thing as it helps generate more money in the local community and rewards hard-working employees. We’re happy about it as long as the increases are reasonable and there is a common sense approach to it.”
Malcolms Costcutter, Coventry