National Living Wage rises by 9.8%

The National Living Wage (NLW) rose by 9.8% to £11.44 on 1 April. It has also been extended to workers aged 21 and 22, who were previously covered by the highest tier of National Minimum Wage (NMW) ‘youth rates’. Increases for younger workers are proportionally higher: the NMW for 18- to 20-year-olds has risen by 14.8% to sit at £8.60, while 16- and 17-year-olds and apprentices in their first year of training are on a minimum rate of £6.40, up 21.2% from 2023.

With this latest increase, the NLW has met its four-year target of reaching two-thirds of median earnings by October 2024 and the remit for the Low Pay Commission (which advises the government on the level of the NLW and NMW) for the coming year is to maintain the NLW at this level. On this basis, the Commission projects the NLW to be £11.61-£12.18 (with a central estimate of £11.89) in April 2025. Meanwhile the voluntary living wage, which is set by the Living Wage Foundation and covers all workers aged 18 and over, is currently £12.00 (£13.15 in London), some 56p or 4.9% more than the new NLW.

IDR has just launched a new survey of minimum pay rates, which aims to explore the impact of these latest increases on employers. Please click here to take part in this research and receive a free summary of our findings.