Record employment and high profits show employers can afford a minimum wage increase, according to a submission to the Low Pay Commission by the TUC.
The claim comes as ONS figures show the employment rate is at its highest level since comparable records began 45 years ago, with unemployment now stands at below 5%.
Profits have also risen to record levels. The net rate of profit in UK-owned companies is now 13% – the highest in nearly 20 years. The service sector, which employs many workers on the minimum wage, sees profits of 19% – the highest since records began.
“The combination of large profits in the service sector and high employment shows that employers can afford a pay rise for minimum wage workers,” says the TUC General Secretary, Frances O’Grady (pictured).
“Employers will always protest that the minimum wage in unaffordable. We need to look beyond the rhetoric and focus on the evidence. This is a golden opportunity to raise living standards for nearly two million low-paid workers.
Boosting workers’ spending power will be especially important given the risks our economy faces from Brexit, says O’Grady.
She added: “The government wrongly denies the full minimum wage to workers under 25. Under-25s face the same costs as older workers, and are highly productive. Young workers cannot be left behind. The full rate should be extended to everyone aged over 21 and the age pay gap closed.”