Millions of low-paid workers are set to benefit from a significant wage boost. Starting in April 2025, the national living wage (NLW) will rise by an inflation-beating 6.7%, equating to an extra £1,400 annually for full-time workers over 20. The new daily rate will be £91.58 for a seven-and-a-half-hour shift. This increase will raise the annual salary for these workers to £23,809.76 before tax.
For younger workers aged 18 to 20, the NMW will see its largest-ever increase, rising from £8.60 to £10 per hour – an annual increase of £2,500 for full-time roles. Similarly, apprentices will receive a significant wage rise, increasing their hourly rate from £6.40 to £7.55 – an impressive 18% uplift.
With the Low Pay Commission’s recommendation for the NLW to rise by up to 5.8%, the Government’s increase goes further than anticipated. However, the higher wage bill and potential employer national insurance contribution increases may strain businesses. As a result, some employers may face staffing challenges or even risk insolvency.
This increase is expected to benefit around 3.5 million workers. Meanwhile, low-paid jobs have fallen from 9.8% to 3.4% of the workforce, the lowest level since 1977, as higher minimum wages reshape the labour market.
In 2024, a low-paid job is defined as paying under £11.39 per hour.
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