It’s looking like good news for low-paid workers over the coming months and years. The government’s new Living Wage – announced in last year’s Budget – is being rolled out to help ensure everyone can earn enough to live on.

Those on minimum wage who are aged 25 and up will be earning at least £7.20 an hour from April, rising to £9 an hour by 2020. Currently the minimum wage is £6.70 an hour for over-21s.

This April’s rise means a person working 40 hours a week on the new living wage will earn nearly £15,000 a year before tax.

Higher wages sound like a great deal – who doesn’t want more money? But not everyone is on board with the idea.

Logically, we could say that if workers are being paid more, an employer can’t afford to take on as many people. That would therefore put people out of work, as well as be a strain on employers who now have to do the same amount of work with fewer staff.

However research says that better-paid staff are happier staff who care more about their work, as well as being healthier and harder working. That’s not to mention that well-paid employees stay around longer, reducing spend on recruitment and training. This means that a pay rise could in fact result in higher profits and therefore not lead to job cuts.

And for those who see the current minimum wage as exploitative, they may argue that the existence of fewer jobs that pay a decent wage would still be better than more jobs that don’t pay enough.

Nevertheless it’s a common view among employers that they should be allowed to pay their employers what they like, and that the government should not have a say in such things. Other employers agree with the minimum wage in principle but think the increases are too much too soon. And these fears aren’t restricted to employers either, as some workers now on minimum wage worry that it will be harder to keep their jobs.

Finally, in contrast to those concerned about lost jobs, others claim the baseline wage is not rising fast enough. The Living Wage Foundation recommends a rate of £8.25 right now (£9.40 in London) due to the rising cost of living, and takes issue with the government’s use of the term “living wage” being applied to a lower figure.

Increasing the minimum wage is always a risk, but even as it has risen over the years, the number and quality of jobs available has always risen. Additionally, most of us would like to think that when we go to a restaurant or stay in a hotel that everyone who works hard for our benefit is being paid enough to support themselves. Do you agree with the increases? What do you think is a fair wage? Let us know in the comments!

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