London (Parliament Politics Magazine) – Minimum pay in the UK will increase next April, with hourly rates for those over 21 arranged to rise to £12.21 an hour, the chancellor has confirmed.
Chancellor Rachel Reeves stated the pay increase marked a “significant step” towards fulfilling Labour’s promise of a “genuine living wage” for workers. Workers aged 18 to 20 and apprentices will also notice their minimum hourly pay gain. The government declared more than three million employees will benefit.
How does the pay increase affect younger workers?
The lowest pay for over 21s, known officially as the National Living Wage, will increase by 6.7%, from £11.44 to £12.21 from April 2025. For someone functioning full time, or a 37.5 hour week, that correlates to £23,873.60 a year, increase from £22,368.06. For 18 to 20-year old, the minimum salary will increase from £8.60 to £10. This indicates someone on a 37.5-hour week would make £19,552 a year, up from £16,815. Trainees will get the most significant pay bump, from £6.40 to £7.55 an hour. That suggests their annual wage will increase to £14,762 from £12,513 at the moment.
Why is this pay hike considered a significant step?
The Treasury expressed a big hike in the minimum pay for under 21s the biggest on record marking the first stage towards a single rate for all adults. It comes after the administration instructed the Low Pay Commission, which suggests minimum wage rates, to include the expense of living in its calculations. The rates for the National Living Wage and National Minimum Wage are established by the government every year, with the new rates taking effect the following April.
According to Experts, while the boost was “good news” for minimum earners, the 77p increase for employees over the age of 21 was smaller than in each of the last two years. The smaller peak was “sensible” in the context of the expected peak in National Insurance contributions for employers in the Budget. Business owners, especially smaller ones, have expressed concerns over the effect of higher wage bills and workers’ rights reforms.