The UK government announces a big change to the National Living Wage in April 2021 – Millions of people are expected to receive a pay rise

In our previous post, “November Spending Review: Early Years Funding – Treasury announces £44 million additional funds“, the government announced their intention to increase the National Minimum Wage for younger workers and apprentices and now the government has confirmed their intentions by releasing the below press release.

From April 2021 there will be an increase in National Living and National Minimum Wages, the lower age threshold for the National Living Wage is being reduced to 23. Anyone under 23 will still be entitled to the relevant National Minimum Wage.

Increase in National Living and National Minimum Wages:

In addition to the lower age threshold, the National Living Wage will also increase by 2.2% from £8.72 per hour to £8.91 per hour. So for 23 and 24 year olds currently earning minimum wage, the new threshold will mean they take home 71p more per hour.

The other minimum wage rates are also set to increase from April. Based on the recommendations by the Low Pay Commission (LPC), the new hourly rates will be as follows:

  • National Living Wage (23+) to increase 2.2%, from £8.72 to £8.91
  • 21-22 year olds – up 2% from £8.20 an hour to £8.36 an hour
  • 18-20 year olds – up 1.7% from £6.45 an hour to £6.56 an hour
  • 16-17 year olds – up 1.5% from £4.55 an hour to £4.62 an hour
  • Apprentices – up 3.6% from £4.15 an hour to £4.30 an hour

Business Secretary Alok Sharma later commented by saying:

“While this has been an extraordinarily difficult year for millions of people, this government remains absolutely committed to putting more money in the pockets of the UK’s lowest-paid workers.

“This measured rise strikes the right balance between supporting hard-working families through this tough time, while protecting firms as they recover from the impacts of COVID-19.”

Read the full Press Release from the government here.



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