By Jamie Beauvais | @bouvoir
The Prime Minister, Boris Johnson announced in December that the national living wage would increase from £8.21 to £8.72 an hour for over 25s in April and pay rates will also rise across all other pay groups. This was a pre-election commitment by the then Chancellor of the Exchequer, Sajid Javid
From April 2020, the new rates are:
The National Living Wage for ages 25 and above – up 6.2% to £8.72
The National Minimum Wage for 21 to 24-year-olds – up 6.5% to £8.20
For 18 to 20-year-olds – up 4.9% to £6.45
For under-18s – up 4.6% to £4.55
For apprentices – up 6.4% to £4.15
The announcement made by Johnson sparked debate between a number of officials and political commentators as to whether the increase is enough, alternatively, descenters argue that it is not economically plausible.
“Workers are still not getting a fair share of the wealth they create… “No more excuses, working families need a £10 minimum wage now, not in four years’ time”.Francis O’Grady,General Secretary of TUC (Trade Union Congress) responded.
The Living Wage Foundation also believes the real living wage should be set at £9.30 an hour and £10.75 an hour in London.
Hannah Essex, co-executive director of the British Chambers of Commerce, in opposition of the proposed increase suggested that “raising wage floors so far above the rate of inflation will pile further pressure on cash flow and eat into training and investment budgets”.
Contextually, The Huffington Post published the startling statistic that the world’s richest 500 people increased their collective wealth by 25% in 2019 (and that) the 500 wealthiest people held a net worth of $5.9 trillion- collectively up $1.2 trillion over 2019 alone. Familiar CEOs and big business names were among the list including Brits James Dyson & Hugh Grosvenor, as well as Amazon founder, Jeff Bezos and Facebook co-founder and CEO, Mark Zuckerberg.
The CIPD and The High Pay Centre suggested at the start of 2018 that top executives will pass the average, annual salary for full time employees on Thursday 4thJanuary 2018. This suggests that top executives surpass the average annual income in the UK in just three days.
The CIPD also stated that the median pay to a FTSE 100 CEO in 2016 was £3.45 million. Little has been done subsequently to remedy the extent of disproportionate wealth. Should the discussion surrounding a living wage instead be based around this bloated disparity in earnings?