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Higher minimum wage may cause job losses

Date 22 Sep 2006
Author bdaily.info
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Many retail job losses are likely in the coming year, according to the British Retail Consortium (BRC). The group reports that the losses will result from the increase in the UK minimum wage – up from £5.05 to £5.35 an hour next month. They also claim that the national minimum wage has already led to 78,000 job losses on the High Street so far.

In a submission to the Low Pay Commission the BRC urged the government to delay the latest rise. But the claims have sparked a row with unions who say employers are using the threat of job losses to hold back pay.

BRC director general Kevin Hawkins said: "Retailers tell us they are being expected to find £2.7bn extra for wages over just two years." He warned that with rental, energy and other charges "shooting up" some employers are looking to cut staffing costs.

But the TUC dismissed the claims, arguing that official figures showed a different picture and that 23,000 retail jobs had been created over the past two years. TUC chief Brendan Barber said "Every year members of the British Retail Consortium predict that an increase in the minimum wage will cause massive job losses and they are proven wrong."

The Transport & General Workers Union (T&G) general secretary Tony Woodley argued that there needed to be a "bold rise" - to at least £6 an hour - in the national minimum wage in order to battle poverty and inequality. "Retail is one of the lowest paying sectors yet Tesco, for example, has reported £2.35bn profit, 17% higher than last year. "Companies can afford a rise, and workers deserve it."

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