08 March 2007, 20:10 PM
  • The 17 pence increase in the National Minimum Wage announced on 7th March is good news for hard pressed retailers who feared another inflation-busting increase this year.

The British Retail Consortium (BRC) had called for this year’s increase to be no more than inflation, the only business organisation to do so.

Reacting to today’s news, British Retail Consortium director general, Kevin Hawkins, said, “This is good news and exactly what we asked for. The BRC is the only business organisation that has consistently argued for no real-terms increase in minimum wage costs and backed that up with detailed evidence which, we believe, impressed the Low Pay Commission.

“Hard-pressed retailers have had to cope with a £2.7 billion hike in wage bills caused by the previous two above-inflation increases. The BRC’s survey of retailers shows that between 2005 and 2006 78,000 retail jobs were lost. That’s not scaremongering about what might happen in the future, they are real jobs that are no longer out there for real people.”

He added that with energy prices, rents, rates, and service charges also on the increase, cutting staffing costs by employing fewer people would have been one of the few ways retailers could have accommodated another inflation-busting increase. “What retailers want now is an end to this annual uncertainty. There should be no real-terms increase next year either while the Commission reviews the future direction of the minimum wage and produces, what we hope will be, a more predictable formula for future changes.

“We will be contributing some constructive and practical ideas to this review,” he concluded.