BRITAIN'S minimum wage will increase by 9.8 per cent to £11.44 an hour from April 2024, making it one of the highest as a share of average earnings of any advanced economy.
Chancellor of the exchequer Jeremy Hunt announced the increase on the eve of delivering a mid-year budget update.
Last month Hunt told the annual conference of his Conservative Party that he intended to increase the minimum wage to at least £11 an hour, part of a goal to raise it to two thirds of average earnings.
"The National Living Wage has helped halve the number of people on low pay since 2010," Hunt said on Tuesday (21).
The big rise in the minimum wage comes as the Bank of England warns that the current pace of wage growth in the broader economy - which reached around eight per cent earlier this year - would make it hard to return inflation to its two per cent target.
In 2022, the OECD estimated Britain's minimum wage was equivalent to 58 per cent of full-time earnings, the third-highest in western Europe after Portugal and France.
Around 2.7 million workers will benefit directly from the increases, the government said.
As part of the changes, workers aged 21 and 22 will be entitled to the full minimum wage for the first time, while lower rates paid to workers aged 18 to 20 and apprentices will also increase.
The Low Pay Commission, an expert panel which advises the government on minimum wage increases, said the arguments around the upcoming increase were "finely balanced".
"As last year, businesses felt pressured to pass National Living Wage increases onto consumers. More are worried this year that they are reaching a limit in what they can pass through without undermining demand," it said.
Social care and childcare employers would find it especially hard, it added.
The minister for business, Kevin Hollinrake (Image credit: gov.uk)
Kevin Hollinrake, the minister for business, said: “We have increased the National Living Wage by £1.02 per hour ending low hourly pay for workers aged 21 and above. The annual earnings of a full-time worker on the National Living Wage will have increased by over £8,600 since it was announced in 2015.
“Pakistani and Bangladeshi employees were the highest ethnicity on the National Living Wage between 2021-22, with 10 per cent of this group in jobs on the National Living Wage, and are the most likely to benefit from this uplift.
“This government is maintaining its commitment to ensuring our lowest paid workers receive a fair and justifiable wage.”
Zia Yusuf looks on during the party's national conference at the National Exhibition Centre in Birmingham, Britain, September 5, 2025. REUTERS/Isabel Infantes
