As government policies evolve, various rules are reviewed and updated. One of the key changes coming in April is the increase in the National Living Wage. The new Government has introduced measures to ensure young workers receive fair pay as they enter the workforce.
This blog will outline what the National Living Wage is, who qualifies for it and how much it’s increasing by. It will also look at how businesses and employees may be affected.
What is the Living Wage?
The National Living Wage is the legally mandated hourly wage that employers must pay to workers aged 21 and over. It is different to the National Minimum Wage, which applies to younger workers and apprentices.
Initially introduced in 2016, the National Living Wage aimed to provide better financial security for workers by ensuring they receive a higher minimum wage than the standard National Minimum Wage. The government has prioritised wage adjustments as part of it’s broader strategy to tackle economic challenges, including rising living costs and income inequality.
Research suggests that fair wages contribute to higher job satisfaction and productivity, potentially leading to lower staff turnover and improved workplace morale.
Source: https://civilitypartners.com/can-a-wage-increase-make-employees-more-productive/
Who qualifies for the Living Wage?
From April, the National Living Wage will apply to all workers aged 21 and over. When it was introduced in 2016, it initially applied to employees aged 25 and over, with an hourly rate of £7.20. Over time, the age threshold has lowered and the rates have steadily increased.
The upcoming changes will also bring significant increases for younger workers:
The 18-20 age group will receive a 16.3% pay rise.
Apprentices and 16-17-year-olds will also see an increase in their wages.
New Wage Rates for 2025:
Apprentices: £7.55 per hour
Ages 18-20: £10.00 per hour
Ages 21+: £12.21 per hour
What does this mean for businesses?
Employers must adapt to the new wage rates while maintaining financial stability. Some small businesses, already dealing with rising operating costs, may face additional challenges.
One key issue is the increased National Insurance contributions (NICs) that businesses must pay. As wages rise, employers will also pay more in NICs, further increasing costs.
Now, it’s more important than ever to get the right hire with the rise in costs. Businesses need to make sure that every recruitment decision adds value and contributes to overall efficiency.
Larger businesses may have more flexibility to absorb wage increases compared to small and medium-sized enterprises (SMEs). This could affect job market trends, with workers preferring employers that offer more financial stability.
Businesses can adapt to these changes by investing in staff productivity and improving operations to offset the extra costs. Some may also look at automation and process improvements to maintain profitability while complying with new wage rules.
With wages going up, it is more important than ever for businesses to focus on hiring the right people, not just the most affordable. While it might be tempting to cut costs by prioritising lower salaries, this can often be a false economy.
Bringing in skilled, motivated employees is far more valuable in the long run. The right hire can boost productivity, improve customer service and even spark new ideas. On the flip side, hiring based purely on cost can lead to higher turnover, more time spent on training and lower overall morale, wiping out any short term savings.
By focusing on quality, businesses can benefit from:
Better retention: When you hire the right fit, they are more likely to stick around, saving you the hassle and cost of constantly replacing staff
Stronger performance: Skilled and engaged employees get more done and they do it better
A better reputation: Being known as a company that invests in it’s people makes you more attractive to top talent in the future
To get this right, it is worth fine tuning your hiring process. Be clear on what you really need from a candidate and think about their potential, not just their salary expectations. Partnering with us at Express Recruitment will help with connecting you with the best talent to add real value to your team.
How we can help?
Express Recruitment can support businesses with recruitment, helping them find the right people and exceed expectations every time. We specialise in the East Midlands and have a talent pool of over 20,000 candidates across different industries.
We also offer services to help employers, including our Employee Retention Service, which provides guidance on improving workplace processes to boost staff retention.
For businesses making redundancies, we run a Redundancy Clinic to assist affected employees in finding new roles or accessing career support services.
Conclusion
The increase in the National Living Wage marks a significant change in the UK job market. While it benefits workers, businesses will need to take steps to manage retention and profitability.
Now more than ever, businesses must focus on making the right hiring decisions, keeping key staff and improving efficiency to stay competitive.
For more details or to explore our services, contact our team today.
As government policies evolve, various rules are reviewed and updated. One of the key changes coming in April is the increase in the National Living Wage. The new Government has introduced measures to ensure young workers receive fair pay as they enter the workforce.
This blog will outline what the National Living Wage is, who qualifies for it and how much it’s increasing by. It will also look at how businesses and employees may be affected.
What is the Living Wage?
The National Living Wage is the legally mandated hourly wage that employers must pay to workers aged 21 and over. It is different to the National Minimum Wage, which applies to younger workers and apprentices.
Initially introduced in 2016, the National Living Wage aimed to provide better financial security for workers by ensuring they receive a higher minimum wage than the standard National Minimum Wage. The government has prioritised wage adjustments as part of it’s broader strategy to tackle economic challenges, including rising living costs and income inequality.
Research suggests that fair wages contribute to higher job satisfaction and productivity, potentially leading to lower staff turnover and improved workplace morale.
Source: https://civilitypartners.com/can-a-wage-increase-make-employees-more-productive/
Who qualifies for the Living Wage?
From April, the National Living Wage will apply to all workers aged 21 and over. When it was introduced in 2016, it initially applied to employees aged 25 and over, with an hourly rate of £7.20. Over time, the age threshold has lowered and the rates have steadily increased.
The upcoming changes will also bring significant increases for younger workers:
The 18-20 age group will receive a 16.3% pay rise.
Apprentices and 16-17-year-olds will also see an increase in their wages.
New Wage Rates for 2025:
Apprentices: £7.55 per hour
Ages 18-20: £10.00 per hour
Ages 21+: £12.21 per hour
What does this mean for businesses?
Employers must adapt to the new wage rates while maintaining financial stability. Some small businesses, already dealing with rising operating costs, may face additional challenges.
One key issue is the increased National Insurance contributions (NICs) that businesses must pay. As wages rise, employers will also pay more in NICs, further increasing costs.
Now, it’s more important than ever to get the right hire with the rise in costs. Businesses need to make sure that every recruitment decision adds value and contributes to overall efficiency.
Larger businesses may have more flexibility to absorb wage increases compared to small and medium-sized enterprises (SMEs). This could affect job market trends, with workers preferring employers that offer more financial stability.
Businesses can adapt to these changes by investing in staff productivity and improving operations to offset the extra costs. Some may also look at automation and process improvements to maintain profitability while complying with new wage rules.
With wages going up, it is more important than ever for businesses to focus on hiring the right people, not just the most affordable. While it might be tempting to cut costs by prioritising lower salaries, this can often be a false economy.
Bringing in skilled, motivated employees is far more valuable in the long run. The right hire can boost productivity, improve customer service and even spark new ideas. On the flip side, hiring based purely on cost can lead to higher turnover, more time spent on training and lower overall morale, wiping out any short term savings.
By focusing on quality, businesses can benefit from:
Better retention: When you hire the right fit, they are more likely to stick around, saving you the hassle and cost of constantly replacing staff
Stronger performance: Skilled and engaged employees get more done and they do it better
A better reputation: Being known as a company that invests in it’s people makes you more attractive to top talent in the future
To get this right, it is worth fine tuning your hiring process. Be clear on what you really need from a candidate and think about their potential, not just their salary expectations. Partnering with us at Express Recruitment will help with connecting you with the best talent to add real value to your team.
How we can help?
Express Recruitment can support businesses with recruitment, helping them find the right people and exceed expectations every time. We specialise in the East Midlands and have a talent pool of over 20,000 candidates across different industries.
We also offer services to help employers, including our Employee Retention Service, which provides guidance on improving workplace processes to boost staff retention.
For businesses making redundancies, we run a Redundancy Clinic to assist affected employees in finding new roles or accessing career support services.
Conclusion
The increase in the National Living Wage marks a significant change in the UK job market. While it benefits workers, businesses will need to take steps to manage retention and profitability.
Now more than ever, businesses must focus on making the right hiring decisions, keeping key staff and improving efficiency to stay competitive.
For more details or to explore our services, contact our team today.