ACS (the Association of Convenience Stores) has welcomed the Government’s announcement on 2021 wage rates as a measure that will help retailers keep more colleagues employed.

In today’s Spending Review, Chancellor Rishi Sunak confirmed that the Government have accepted the Low Pay Commission’s recommendations in full for wage increases in 2021. From April 2021, the National Living Wage rate will rise to £8.91 per hour, a 2.2% increase on current rates. The National Living Wage will also apply for all staff aged 23 and over (currently aged 25 and over).

Association of Convenience Stores chief executive James Lowman said: “These are extraordinary and challenging times for businesses. Wage costs remain the biggest cost in a convenience store business, so a more restrained National Living Wage Increase will help struggling businesses to keep more colleagues employed rather than having to plan a cut in hours or headcount.

“Our research into the working lives of the 412,000 colleagues in convenience demonstrates how important the local, flexible and secure jobs that stores provide are, and we will continue to work closely with Government and the Low Pay Commission to detail the impact of rising wages on the convenience sector and the uneven impact of Covid-19 this year.”

ACS’ written evidence to the Low Pay Commission submitted earlier this year outlined that convenience retailers have responded to the 2020 National Living Wage rate by taking the following actions:

  • increasing the hours worked in the business (64%)
  • taking lower profits from the business (56%)
  • reducing staffed working hours (48%)

In their report on recommendations for the 2021 wage rate, the Low Pay Commission refer to concerns raised by ACS about retailers taking on more hours in the business themselves, as well as the significant impact that the pandemic has had on stores that rely on office workers, commuters and transient trade.

The current National Living Wage and Minimum Wage rates stand at £8.72 per hour for those aged 25 and over, £8.20 for those aged 21–24, and £6.45 for ages 18-20.

The Government has set a target for the National Living Wage to reach 2/3 of median earnings by 2024, after achieving its previous target of 60% of median earnings by 2020.

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