Living wage concerns raised by Barking and Dagenham businesses

Mark Bass, president of the Barking and Dagenham Chamber of Commerce

Mark Bass, president of the Barking and Dagenham Chamber of Commerce - Credit: Archant

Small firms are expected to slow hiring and increase prices in response to a National Living Wage increase, according to a new report.

With a new rate for the over 25s coming into effect from April, a Federation of Small Businesses (FSB) survey has found significant numbers of small firms concerned about the impact it will have.

Over a third, 38 per cent, of small employers expect the new National Living Wage of £7.20 an hour to negatively impact their business when it comes into force.

When asked to consider the projected rise to at least £9 an hour by 2020, over half, 54pc, said it will have a negative impact.

Just six percent of businesses thought the policy would have a positive impact on them when it is implemented next April.


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But Mark Bass, president of the Barking and Dagenham Chamber of Commerce, insists it’s the right thing to do.

“It’s definitely going to have an effect on small businesses,” he said.

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“But I also sympathise with those people on the minimum wage.

“I think people will warm to businesses that do pay the living wage – people deserve a living wage.

“Businesses shouldn’t be competing at the expense of their staff and not save on the living wage.

“If a businesses provides employment it shouldn’t be exploiting its employers.”

The FSB has also published its latest Cost of Employment Index which estimates that for a small retail business with six full-time staff aged 25 or over and earning the current adult minimum wage, the national living wage will cost an extra £5,900 a year.

When businesses that said they will be negatively impacted were asked how they will adapt to the new rates, 52pc said they would put off hiring new staff while half said they will raise their prices.

Will you be affected?

Send your views to mark.shales@archant.co.uk or call 020 8477 3824.

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