How will the Budget changes to the minimum wage affect Road Haulage, Freight and Logistics Outfits?
The Chancellor made a surprise announcement in the Summer Budget of a ‘national living wage’ of £7.20 per hour for workers aged over 25 from next April.
There will be many employers running warehouses and logistics operations who will be more than a little nervous about the impact this will have on the competitiveness of their business.
The labour market presently operates on a three-tier minimum wage system. Anyone under 18 years is entitled to receive £3.79, between 18 – 20 years £5.13, and over 21 years £6.50 (rising to £6.80 this October). From next April a further tier will be introduced for the over 25s at £7.20, rising to £9 by 2020.
Companies will need to invest in better training and on improving the individual worker’s efficiency for a more productive and expensive working life over the age of 25. The new ‘national living wage’ recognises the benefits an older worker brings, such as maturity, stability and experience. However, productivity of the individual worker must rise and that means companies will need to provide better training and investment in their young workforce to create a more productive future that we can all afford.