Firms see minimum wage rise as justified – for now

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first_imgRelated posts:No related photos. Previous Article Next Article Employerswill not suffer from the increase in the National Minimum Wage announced by theTrade and Industry Secretary last week, according to the CIPD.StephenByers said the rate would be increased from £3.70 to £4.10 per hour in Octoberfollowed by a rise to £4.20 a year later.JohnPhilpott, chief economist at the CIPD, said, “I think it is broadlyjustified. I think it is a bit more than some businesses would want, but if youlook at it in the context of the economy at present it is affordable.”Ifat some stage there was a major economic downturn the increase in the minimumwage might cause problems, but in the current circumstances it looks like areasonable increase.”TheCBI, which had opposed any increase in the minimum wage, also gave its support.Director general Digby Jones said, “The Government has gone as far as itcan without moving to a point where the damage outweighs the benefits. It isgiving a pay rise of nearly 11 per cent to some 1.3 million low paid workers tohelp ensure the wage doesn’t wither on the vine.”Butsome business leaders have criticised the stop-go nature of the increases sincethe pay floor was introduced in 1999.”Thereis no doubt that this will have some impact on business survival andconsequently on jobs, particularly in the textiles, retail and social caresectors,” said Chris Humphries, director general of the British Chambersof Commerce.SharenPhillips, HR director at ESC UK, said, “Does the minimum wage have to riseso steeply and so frequently? Does the Government realise that it isjeopardising the future of small businesses that do not have the profit marginsto sustain such increases?”ByBen Willmott Comments are closed. Firms see minimum wage rise as justified – for nowOn 13 Mar 2001 in Personnel Todaylast_img read more