It is set at a level that ensures they can earn a decent living. This has been a significant step towards creating a more equitable society, and the recent announcement by Chancellor Jeremy Hunt to increase the NLW by over a pound an hour is a testament to the government's commitment to this cause.
"The NLW currently stands at £10.42 per hour, and the promised increase will take it to £11.44 per hour in April 2024!"
This means that a full-time worker on the NLW will see their annual salary rise from around £10,500 to nearly £21,000. This is a significant jump and will have a very positive impact on the lives of millions of workers across the country.
But the increase in the NLW is not the only positive change announced by Chancellor Hunt. For the first time, eligibility for the NLW will be extended to 21-year-olds, who will now receive a 12.4% increase, from £10.18 to £11.44 per hour. This is a significant step towards bridging the gap between the NLW and the National Minimum Wage (NMW), which currently stands at £8.91 per hour for workers aged 23 and over.
The increase in the NLW is also a reflection of the UK's economic growth and recovery from the COVID-19 pandemic. Despite the challenges faced by the country in the past year, the government's commitment to supporting workers and promoting fair pay has remained steadfast.
This increase in the National Living Wage will not only benefit workers, but also contribute to the overall economic growth of the country. With more money in their pockets, workers will have more disposable income to spend, boosting consumer spending and stimulating the economy.
I feel this is a much-needed pay rise for millions of workers who have been struggling to make ends meet and it will certainly help to boost consumer spending and support the country's economic recovery!
But there are also concerns about the potential impact of the NLW increase on businesses, particularly small and medium-sized enterprises (SMEs). The increase could be challenging for some small businesses to absorb. I believe the Government must ensure that appropriate support and guidance are provided to businesses to help them adjust.
However, millions of workers will soon benefit from this historic change, and that can only be a good thing overall.
Until next time ...
ROGER EDDOWES Business Godparent
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about the National Living Wage and how it may affect your business, it may be a great idea to call me on 01908 774320 and let's see how I can help.
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Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
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