Labour’s manifesto committed to scrapping “discriminatory” age bands, and to increase wages for 18 to 20-year-olds so young workers are paid the same as those over 21
Labour committed to equalise pay rates between older and younger workers(Image: GETTY)
The minimum wage is expected to rise by nearly 4 per cent for lower earners in the Budget – but increases look set to slow for younger workers.
Chancellor John Healey is poised to increase the national living wage, which applies to people aged 21 and over, from £12.71 per hour to around £13.20. Younger workers aged 18 to 21 will see their rate from £10.85 to around £11.27, an increase of 3.9 per cent, according to The Times.
Labour’s manifesto committed to scrapping “discriminatory” age bands, and to increase wages for 18 to 20-year-olds so young workers are paid the same as those over 21.
The minimum wage for younger workers rose by 8.5% this year, reducing the difference to £1.86 an hour. A Treasury spokesman declined to comment.
Speculation has been mounting for months that the Government could back down on its plans to equalise the rates amid alarm over levels of youth unemployment.
The numbers of young people not in education, employment or training (Neets) exceeded a million earlier this year – for the first time since 2013. Ex-Cabinet Minister Alan Milburn is expected to publish his review into the crisis in the coming weeks.
Critics have argued increases to the minimum wage are discouraging employers to take on younger workers. But the TUC rubbished the warnings about equalising the rates, pointing to analysis showing 85% of youngsters are already paid above it.
Previous minimum wage rises to bring 23 and 24-year-olds, and later 21 and 22-year-olds, in line with adult rates didn’t impact employment rates, according to the Low Pay Commission.
It comes as polling found that a majority of voters want action on energy bills to be the government’s top priority. Research by More In Common found that 38% want Mr Healey to focus on reducing bills, more than the 25% thinking food prices and petrol (13%) should be top of his list.
Taxes on vape shops and energy companies were also popular, with 60% and 58% backing these respectively. A wealth tax of 1% on assets worth more than £10million was also supported by 55% – including among people who voted for the Tories in 2024.
However it found that most Britons are pessimistic about the cost of living – with 56% unsure whether it will ever end. More than half (51%) said their finances have got worse over the past year, with just 11% believing this has improved.
