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Teaching activity

In the News Teaching Activity – inflation-busting increase in national minimum wage for 2024 (Nov 2023)

Elizabeth Veal

27th November 2023

The government has announced a significant increase in the national minimum wage rates to take effect from April 2024.

The UK's National Living Wage, set to increase to £11.44 per hour from April, marks a 9.8% rise for workers over 23 and an even greater 12.4% increase for those aged 21 and 22. Chancellor Jeremy Hunt's decision extends the rate to 21-22 year-olds for the first time, benefiting 2.7 million low-paid workers. The move aligns with the Conservatives' goal to "end low pay." While praised for addressing the cost of living, concerns have been raised by industries, such as hospitality, about the higher wage bills coming on top of the high food ingredient inflation and energy price hike. These industries point out the need for additional measures to reduce business costs.

Minimum wage to rise to £11.44 per hour - BBC News

1 Why does the government set a national minimum wage?

2 Using a labour market diagram, show how an increase in the national living wage could cause some real wage unemployment.

3 The hospitality industry is concerned about the uplift in the minimum wage adding to its business costs. What ‘additional measures’ could be introduced to reduce their business costs?

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Elizabeth Veal

Liz has taught Economics for over 25 years, including several years as Head of Economics at leading schools.

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