There’s been much said about the new National Living Wage (NLW) that came into force on 1 April 2016, but what impact will this have on the jobs market?
Employers are now legally required to pay workers at least £7.20 who are aged 25 or older. The government’s aim is for this to rise to £9 by 2020.
Though some 1.8 million workers who currently earn below this figure stand to benefit from the increase, there is talk the new legislation will lead to job losses.
Kevin Brady, spokesman for the job search site AdView, which adds over 100,000 new jobs each week, commented:
“There’s been plenty of contradictory opinions in the news recently. This reflects just how difficult it is to assess how the jobs market will be affected.
“The official estimate from the Office for Budget Responsibility is that by 2020 there’ll 60,000 less jobs due to the new minimum wage. However according to the Fair Work Commission the effect of the increase towards unemployment will be negligible.
“What’s certain is that right now there are more vacancies available at almost any point since the recession. Salaries have also increased too in many instances. From this perspective, there’s not been many better opportunities since 2008 to find a new job.”
But with unemployment just hovering above 5% and talk of job losses, how will the recruitment industry be affected?
“We don’t expect the recruitment industry to be overly affected by the news. From a pure employer’s perspective, our databases suggest that retail, hospitality and customer services are the major sectors most likely to be to be affected, if any.
“Another factor to consider is the hundreds of thousands of self employed workers earning below the new figure who won’t stand to benefit. How many of those will now be inclined to look for a permanent role and what impact could this have on competition for jobs?”