New Living Wage plans: “Disappointing”

George Osborne

George Osborne credit: http://2020.sc/trrFy

Chancellor George Osborne announced in the budget that the National Minimum Wage is to rise from £6.50 per hour to £7.20 next April and up to £9 per hour by 2020 – as so-called “Living Wage”.

NHF president Paul Curry commented: “Introducing a compulsory increase in wages for the over 25s is a disappointing decision. Hairdressing is an unusual industry in that salons generally are small businesses but highly labour intensive. They rely on having enough staff on the salon floor to provide the best experience possible to clients.

“To that end, hairdressing salons, barbershops and beauty salons will be hit disproportionately hard by this enforced increase. In effect, with the National Minimum Wage also going up this from October, salons will be having to cope with two sharp increases in wages within a matter of months.

“The raising of the Employment Allowance announced by the chancellor will certainly help to offset some of the impact of this rise, and salons will of course have no option but to find this extra money from somewhere.

“But I fear the burden of new National Living Wage will mean many salons will be forced to reduce hours or cut jobs, and will be less likely to invest in  apprentices. For some salons I fear it might mean they have to take a long hard look as to whether they can even afford to continue on in business.

“The chancellor’s decision may have been made with the best of intentions, but it has the potential to cause real damage to our industry.”

The national minimum wage has age-related bands.

21 and over 18 to 20 Under 18 Apprentice*
2014 (current rate) £6.50 £5.13 £3.79 £2.73