UK (Parliament Politics Magazine) – The UK government has approved a 4.1% increase in the minimum wage effective April 2026, raising the National Living Wage for workers aged 21 and over to approximately £12.71 per hour. The rise will be larger for younger workers and apprentices, with increases ranging between 6.0% and 8.5%, reflecting ongoing efforts to reduce pay disparities by age.
Government announces 4.1% minimum wage increase
The UK government has confirmed that the main minimum wage rate will increase by 4.1% from April 2026, bringing the hourly pay for workers aged 21 and older from £12.21 to around £12.71. Finance Minister Rachel Reeves stressed the importance of this rise to ensure that low-income workers receive fair compensation consistent with average earnings growth in the economy.
Bigger pay boosts for younger workers and apprentices
Alongside the adult minimum wage increase, wages for younger workers and apprentices will rise by between 6.0% and 8.5%. This forms part of the government’s strategy to phase out lower minimum wage rates for younger age groups, striving for equal pay structures that reflect the contributions of all workers regardless of age. Approximately 2.3 million workers aged 21+ and 300,000 younger workers and apprentices will benefit from the pay hikes.
Economic context and inflation concerns
This increase follows a 6.7% rise implemented earlier in 2025 and aligns with the government’s commitment to link the National Living Wage to approximately two-thirds of median earnings. However, the hospitality sector has voiced concerns that such increases will result in higher prices for consumers as businesses pass on costs, potentially worsening inflation which currently stands at 3.6% the highest among major advanced economies. The Bank of England and economists warn that wage growth exceeding 3% could impede progress toward inflation targets amid sluggish productivity
Impact on employers and labour market dynamics
Employers in labour-intensive sectors such as retail, hospitality, and social care are bracing for added wage pressures, which have already contributed to hiring slowdowns and increased unemployment to 5.0%, the highest since 2021. Despite these challenges, the Low Pay Commission maintains that previous increases have not significantly harmed job availability, balancing the needs of workers against the costs borne by employers. The final legislative approval is expected following consultation and review of economic data through the autumn.
Next steps and implementation
The minimum wage increase will come into legal effect on 1 April 2026. Workers are advised to check their payslips after this date to ensure compliance with the new rates, and underpayment remains enforceable by HM Revenue and Customs. The government’s broader goal remains to gradually eliminate lower age band rates and create a more equitable pay structure across all age groups.