The National Minimum Wage (NMW) and National Living Wage (NLW) will increase this April, offering all workers aged 16 and over, including apprentices, a higher hourly wage. As this welcomed change could significantly impact you and your business costs, keep reading to explore a summary of the arising changes, implications, and potential business opportunities.
NMW and NLW Increase Announcement
From April 1st, 2024, the Government will implement the largest ever increase in minimum hourly wage for workers aged 16 and over, accepting in full the recommendations of the Low Pay Commission. The NLW (21 years and over) will see a 9.8% (£1.02) increase, rising to £11.44 per hour. Apprentices will also reap the benefits of these changes, earning £6.40 an hour with a 21.2% increase.
This climb, announced by the Government in November 2023, will support the wages and living standards of low-paid workers at a time when many feel increased pressure amid a rise in the cost of living.
NMW and NLW Increases in 2024
The Government has confirmed the following NMW rates, designed to better protect as many low-paid workers as possible without hurting jobs or the economy, especially as the UK navigates its way through the Cost-of-Living Crisis.
What Do These Changes Mean for Apprentices and Recruitment?
A pay rise will likely boost the value of apprenticeships for aspiring candidates and employee retention for businesses like yours. As companies continue to compete to recruit and retain staff, this rise in apprenticeship appeal could prove vital for filling vacancies with talent for a low cost and offering long-term employment opportunities.
From an outsider’s perspective, this change is undoubtedly a promising step forward for apprentices across the UK striving to be paid fairly for their hard work, resilience, and dedication. However, some recruitment experts who liaise with apprenticeship candidates and hiring employers daily challenge the extent of this progression and take a different stance, calling for apprentices to receive more recognition for their efforts and for the Government to convey an apprenticeship’s industry value via the pay cheques given.
Recruitment Manager at CT Skills, Lesley Bell, speaking on the upcoming changes to NMW and NLW:
“Whilst the forthcoming increase in NAW is of course welcomed (21% is the highest increase we’ve seen in 5+ years), it fails to meet the needs of its intended recipients. Whilst yes, many applying for apprentices are who we expect, i.e. 16-19 years, who by virtue are living at home, limited expenditure etc., this is not true of all. Since 2020, we have seen a significant shift in applicant demographic; a rise in returners to work, career changers etc., all of whom see apprenticeships as the route for step change. And why not? The government last week stated its commitment to supporting more people back into work, surely apprenticeships have a valuable role to play.
Let us not forget, however, those who apprenticeships were originally designed for; as the demographic changes and employers see greater choice in applicants, where do our 16–19-year-olds stand? How do they compete against a returner to work, with experience, if willing to work for NAW? And should they have to compete?
For me, Apprenticeships work. The concept, and opportunity they give, in a time when employers value experience more than ever, works. So, make it pay.”
New Investment for Apprenticeships, March 2024
Alongside changes to hourly rates for apprentices, the Government has recently announced a £60 million new investment to enable up to 20,000 more apprenticeships, including for young people and small businesses. This is aimed at reducing costs and burdens for businesses and delivering more opportunities for young people to kick-start their careers, all while removing the need for small employers to meet some of the cost of training. The investment will save time and costs for providers like further education colleges, who currently need to source funding separately from the Government and businesses.
Education Secretary, Gillian Keegan said:
“Apprenticeships are a fantastic way for businesses to develop the skills they need, and these new measures will help more businesses and young people benefit from them.”
To discover more about how the upcoming changes could impact your business, get in touch. Alternatively, explore how hiring an apprentice with CT Skills could benefit your business by clicking here.