National Living Wage set to rise by 6.6%

The rise in the National Living Wage is a sign of positivity for many hospitality workers. Chancellor
Rishi Sunak has announced a 6.6% rise to £9.50, one of the largest rises ever in the National Living Wage. Following recommendations from independent advisors, the increase is set to come into effect on 1st April 2022, and for a full-time worker will mean an additional £1,074 per year before tax.

The National Living Wage is applicable to workers aged 23 and over, but younger hospitality workers are set to benefit as well. The minimum wage for 21 and 22-year-olds is growing by 9.8% to £9.18, for 18-20-year-olds to £6.83, and for 16 and 17-year-olds to £4.81.

The hospitality industry is already committed to paying a fair wage. Pay within the sector has steadily increased by around 20% over the past five years, and has continued to grow since the postCovid19 reopening, demonstrating real signs of hospitality recovery and renewed hope of filling the hotel management vacancies across the country.

Further support is needed

Rising wages mean that hospitality businesses are likely to need further support from the government in order to keep the industry flourishing. Since reopening, wages have continued to grow despite rising inflation and many hospitality businesses going into debt so that they can survive.

Fortunately, the Chancellor is also expected to announce an extension to the current Coronavirus recovery loan scheme. The scheme gives UK businesses, including those in the hospitality industry, access to funds as they recover from the disruption caused by the pandemic. Currently due to end on 31st December, it’s anticipated that a six-month extension to the scheme will be announced, enabling more hospitality businesses to access the funds they need.

Other ways the government can support hospitality

As well as extending the recovery loan scheme, there are other measures the government could put in place to support hospitality recovery. The government is expected to conclude its review into business rates imminently, and whilst hospitality businesses were exempt from paying for 15 months as part of the government’s support for Covid19, permanent reforms would have a significant impact. Added to that, making the current VAT rate of 12.5% a permanent change would accelerate hospitality recovery.

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The hospitality industry needs the right staff to aid its recovery. At JW Recruitment we specialise in all areas of hospitality recruitment. Contact us to discuss how we can support you.