Business

Thousands in Northern Ireland get pay boost as living wage goes live

Workers will receive a pay rise today when the new national living wage comes into force

THOUSANDS of workers in Northern Ireland will receive a pay rise today when the new national living wage comes into force.

Unions welcomed the £7.20 hourly rate for adults - increasing by 50p from £6.70 - but said it was not fair that younger workers were missing out, while business groups warned that firms' wages bills will "ratchet up".

The government's aim is to increase the rate to £9 an hour by 2020, which would affect an estimated nine million workers.

But while 1.3 million workers across the UK will benefit immediately, the pay rise hasn't been universally welcomed.

Indeed small shops umbrella group the Northern Ireland Independent Retail Trade Association (NIIRTA) insists a "significant challenge" will be posed to its members by the introduction of the new rate.

Its chief executive Glyn Roberts said: "Not only do our members have to afford the living wage, but they also have to pay for auto-enrolment, coming at a time when many of them have also experienced quite a hike in their business rates."

He added: "For many small businesses, this is almost a perfect storm of high cost issues."

Research by the Resolution Foundation found that more than one in four employees in most UK regions will benefit, compared to one in seven in London.

TUC general secretary Frances O'Grady said: "Britain desperately needs a pay rise, and this increase is good news for those aged 25 or older.

"But the government must ensure that younger workers are not left behind. 21-24-year-olds will not be seeing an increase on Friday. This is not fair. Future wage increases must narrow the pay gap between old and young."

Dr Adam Marshall, acting director general of the British Chambers of Commerce, said: "The government's new living wage will apply a ratchet effect to all companies' pay bills, and sits alongside a raft of other high employment-related costs.

"While many companies have the ability to increase pay, others will struggle to do so alongside pensions auto-enrolment, the apprenticeship levy, employer National Insurance contributions, and other up-front costs.

"Some will have to divert money from training and investment to increase pay, which could hurt their productivity. Others may stop hiring altogether."

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