National living wage increase in 2024

The UK’s national living wage will rise from £10.42 an hour to £11.44 from this April, and those aged 21 and 22 will now also be eligible to receive it. The minimum wage is also rising in 2024. We explain who will be affected, and the difference between the living wage and minimum wage.

Nearly three million people will benefit from the rise in the national living wage this year, which has been confirmed by the Treasury following the recommendations of the Low Pay Commission in November 2023. The Treasury says this will add more than £1,800 a year to the pay packets of those on full-time contracts.

The real living wage and London living wage have also just risen by 10%. This means around half a million workers will see a pay rise of 10%. However, this is an optional wage that employers can choose to pay and is not a legal requirement.

Is national living wage the same as minimum wage?

National living wage replaced the minimum wage in April 2016, as the lowest amount you could be legally paid per hour – however it initially only came into force for over 25s.  If you were under the age limit, you earned the national minimum wage – based on your age group.  Since then, things have changed a little, with the age limit for earning the national living wage dropping from 25-years-old to 23.  From April 2024, those aged 21 and 22 who are earning the national minimum wage will also earn the same amount as those earning the national living wage.  Apprentices can get the apprentice rate if they’re under 19, or in the first year of their apprenticeship.

What will the minimum wage be from April 2024 to March 2025?

Apprentice Rate	1. National Minimum Wage	2. National Minimum Wage	3. National Minimum Wage	National Living Wage
£6.40	£6.40	£8.60	£11.44	£11.44

Will April’s increase make a difference – The expert view from Spectra.

This increase will be welcomed by all UK low earners, putting more money in their pockets, at a time when the cost of living remains high.  This is good news for pension saving too, enabling more employees to build up larger pension pots, as pension contributions tend to be a percentage of how much someone earns.

However, some employers, particularly those in the retail, care and hospitality sectors, will find themselves disproportionately affected by these rises and will see an erosion between their pay rates and may even find that they have supervisors being paid around 10p per hour more than the rest of the team.  Employers will need to start to think about how they can get a return on paying people more in order to address this issue.