Minimum wage
More than half of companies feel further rises in the minimum wage will hit employment prospects and damage competitiveness, according to research by the British Chambers of Commerce.
The warning comes as the British Retail Consortium estimated that a further sharp rise in the national minimum wage could destroy more than 20,000 jobs in the industry.
Stakeholder Response: British Retail Consortium
Dr Kevin Hawkins, BRC director general, said: "There is clearly no justification for further increases to the NMW in real terms. The rise to £4.85 has already cost the industry £1.7 billion and already jeopardised jobs.
"Another rise in the National Minimum Wage could lead to more than 20,000 jobs being lost and would cost the retail sector an extra £2.7 billion.
"The BRC survey has confirmed retailer’s fears, that an ill thought out decision on this will hit every retailer hard.
"The retail industry employs 2.8 million people – 11 per cent of the total
"We have provided the evidence and it is now up to the Low Pay Commission to act appropriately and keep the wage at a sensible level in line with current economic conditions."
Stakeholder Response: Institute of Directors
A spokesman for the
Stakeholder Response: Federation of Small Businesses
Daniel Mazliah of the FSB said: "The FSB's 185,000 members are for the most part content with the National Minimum Wage (NMW). A 2004 membership survey revealed that only two percent of small businesses felt the NMW significantly decreased their profitability.
"The research did reveal small pockets of unease over the possibility of further rises in areas such as the South West and parts of
"But for now, the FSB is pleased that the Low Pay Commission continues to consult with small firms and take evidence from the business community."
Stakeholder Response: Forum of Private Business
Nick Goulding, Forum of Private Business chief executive, said: "The increase was a shameless piece of electioneering.
"This increase has been badly thought through and will have a variety of negative effects.
"It will hit businesses in poorer and remote areas harder and it will take cash straight out of employers' pockets, since their profits are only going up with inflation.
"Above all it is an unwelcome additional pressure on businesses already being stung with a range of higher costs including increased employers' National Insurance contributions and rocketing levels of insurance premiums.
"The increase will have a heavy impact on high employment sectors such as retail, hotels, restaurants, cleaning, security, social care, hairdressing and textile manufacturing.
"The absurdity is that the minimum wage, for over 21s, was bought in at a sensible level, but is now reaching a dangerously high level.
"The increase is actually going to put jobs at risk and strangle growth in certain regions and sectors.
"Moreover, because local authorities and public services, like the NHS, will have bigger wage bills there is even greater pressure on taxation.
"Furthermore, there is a very real concern that employers will be hit with demands for salary increases from other, better paid, members of staff.
"This means that even those firms, who have so far seen no impact from the minimum wage, are going to start to feel the effect."
Stakeholder Response: British Youth Council
Dan Wood, chairman of the British Youth Council, said: "Research has proven that the minimum wage has not had the disastrous effect on businesses, employment or the economy, which businesses widely predicted.
"The real concern with the minimum wage is that the current tiered wage system is still failing to protect many of the most vulnerable young workers.
"Businesses are simply passing down the costs of the minimum wage onto young workers and using them as a source of cheap labour.
"The three different rates applying to different ages and circumstances is also confusing for workers, especially young people, difficult for businesses to administrate and crucially young people are not getting the level of wage protection that they need and deserve.
"The British Youth Council has joined together with other leading child and youth charities to demand a fairer deal for young people; one simple equal minimum wage for all workers no matter of their age.
"Although we welcome the new minimum wage for 16 and 17-year-olds introduced in October, it does not go nearly far enough towards protecting young people from exploitation and respecting the contribution they make in the workplace.
"Lower wages encourage young people to work longer hours which may damage their education and unnaturally distorts the labour market to the detriment of businesses and young people.
"An equal minimum wage would make a difference to many more young people’s lives; protecting all our most vulnerable workers and giving them a fair, equal and legitimate position in the workplace."
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