Yesterday, Chancellor Rachel Reeves announced a 6.7% pay rise for over 3 million workers, with the National Living Wage (NLW) set to increase to £12.21 from April 2025.
For young workers aged 18 to 20, the NLW will rise by £1.40 per hour to £10, marking the largest increase on record.
Ahead of the Autumn Budget being presented today, the Association of Convenience Stores (ACS) has warned Reeves about the potential negative impacts these wage increases could have on c-stores.
ACS chief executive James Lowman expressed the fears weighing on the minds of many retailers: “Our members are grappling with how to afford this inflation-busting increase in wage costs. The market remains tough, with many retailers reporting flat or declining sales while expenses like banking charges, credit card processing fees and energy bills are eating away at their profitability.
”More than ever, we need help from the Chancellor in the Budget. Without sustained and enhanced help on business rates, a reduction in National Insurance Contributions, and effective incentives to drive investment, our sector faces a challenging future. For some communities, this could mean the viability of their local shop is put at risk.”
Evidence provided to the Low Pay Commission by ACS earlier this year already found that to handle the increases in national wage increases, 53% of retailers have reduced the amount they invest in their business, 53% have been forced to increase their prices in store, and 47% have had to take lower profits.
Baroness Philippa Stroud, chair of the Low Pay Commission (LPC), stated that data already shows signs of employers finding it harder to adapt to minimum wage increases.
To find out more information about the NLW increase, click here.
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