What is the actual cost of the National Living Wage?
Last week we saw the Chancellor of Exchequer George Osborne, announce his Summer Budget, with the main focus being the National Living Wage discussing the incentives for businesses that pay the Living Wage.
Osborne confirmed in the Budget that the new National Living Wage will be made compulsory to all workers aged 25 year and over, starting next April at £7.20 per hour and set to reach £9 per hour by 2020.
Rohan Silva writer at the Observer agrees “A living wage is not just the fair thing to do, it’s good for business.”
The Living Wage foundation agree that it is a benchmark, however, this is not the minimum level of pay that they promote. Calculated by academics, a higher figure of £9.15 per hour in London and £7.85 per hour elsewhere, offers workers enough for a basic standard of living.
Some companies currently pay the recommended amount by The Living Wage Foundation and have seen the benefits.
Head of Corporate Affairs at KPMG commented “As a firm who has paid the living wage since 2006, we have seen the benefits of lower absence and a more engaged workforce.”
“We firmly believe that voluntary adoption of a Living Wage policy by employers, over time, is one of the tools that will help improve social mobility in the UK as well as directly addressing in-work poverty.”