The National Living Wage will increase by £1.02 per hour from April, the Treasury has announced.
Chancellor Jeremy Hunt said: “Next April, all full-time workers on the National Living Wage will receive a pay rise of more than £1,800 a year. This will end low wages in this country, delivering on our manifesto promise.”
“The National Living Wage Program has helped halve the number of people on low wages since 2010, ensuring that work always pays.”
The move will see the National Living Wage rise from £10.42 to £11.44 per hour, representing an increase of almost 10 per cent – the biggest in more than a decade.
Eligibility for the National Living Wage will also be expanded by lowering the age threshold to 21 for the first time.
This means the 21-year-old would receive a 12.4% rise from £10.18 this year to £11.44 next year, the equivalent of almost £2,300 a year for a full-time worker.
National minimum wage rates for younger workers will also rise, the Treasury said. People aged 18 to 20 will receive a pay rise of up to £8.60 per hour – the equivalent of £1.11 per hour.
The Department of Business and Trade estimates that 2.7 million workers will directly benefit from the 2024 National Living Wage increase.
The announcement comes ahead of Hunt’s autumn statement tomorrow, in which he will set out the latest changes to the government’s policy and plans for tax and public spending.
Apprentices will also see their minimum hourly wages increase next year by more than 20 per cent, from £5.28 to £6.40 per hour.
The National Living Wage was introduced in 2016 and currently sets the minimum hourly wage that a person over the age of 23 earns when working.
The Chancellor has fully accepted the proposals made by the Low Pay Commission, the body that advises the Government on the minimum wage. He said the Conservatives’ goal of “ending low pay” by raising the living wage to two-thirds of average earnings had now been achieved.
According to the Treasury, the proportion of workers on low hourly wages has more than halved from 21.3% to 8.9% since 2010, supported by increases in the national living wage.
The Chancellor will set out further measures in tomorrow’s Autumn Statement, which is due to be announced around midday.
When will the National Living Wage rise?
The National Living Wage rate usually changes on April 1st each year. At present, 2.7 million low-wage people are expected to benefit from this increase.
In addition, the National Minimum Wage (NMW) rate, which targets those who are at least of school leaving age, will also rise on 1 April. The minimum wage in this category varies depending on age and whether the person is an apprentice.
How much will the new living wage rise?
- National Living Wage (21 and over): £11.44 per hour (up from £10.42)
- Price for 18-20 year olds: £8.60 per hour (up from £7.49)
- Price for 16-17 year olds: £6.40 per hour (up from £5.25)
- Apprentice rate: £6.40 per hour (up from £5.28)
- Accommodation compensation: £9.99 per hour (up from £9.10)