The Hidden Cost of the Minimum Wage Increases
Minimum wage is increasing to $20 per hour with effect from 1 April 2021 which represents another 5.8% increase, or a 31.1% increase over the last 5 years. Unfortunately, this is about 3 times the rate of inflation over the same period, and this rate of increase is liable to continue until such time as the Minimum wage and the Living Wage are in alignment. Or, in other words, someone who was on minimum wage in April 2016 of $15.25, would now be being paid $16.42 if they had received CPI increases each year.
Whatever your political view-point on this, there are 2 key issues for employers:Minimum wage is increasing to $20 per hour with effect from 1 April 2021 which represents another 5.8% increase, or a 31.1% increase over the last 5 years. Unfortunately, this is about 3 times the rate of inflation over the same period, and this rate of increase is liable to continue until such time as the Minimum wage and the Living Wage are in alignment. Or, in other words, someone who was on minimum wage in April 2016 of $15.25, would now be being paid $16.42 if they had received CPI increases each year.
Whatever your political view-point on this, there are 2 key issues for employers: Read on….