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News - 13 November 2004

Businesses say no to £6 minimum wage

The British Chambers of Commerce (BCC) has rejected calls from the TUC for a £6 minimum wage. In the largest survey on minimum wage of 1,200 UK businesses, 80% called for a cap on future increases.

The BCC survey found that over half the companies questioned believe that further rises will damage employment prospects and competitiveness.

The survey also revealed that of the 80% of businesses that wanted a cap on future increases – 50% of employers wanted the cap to be in line with inflation and 30% wanted the cap in line with national average earnings.

David Frost, Director General of the British Chambers of Commerce said, “The TUC's proposals are totally irresponsible and amount to an increase of 22 times the rate of inflation.

“Business cannot cope with year on year large rises. Recent annual rises at over three times the rate of inflation are becoming an unmanageable cost.

“Our survey is a powerful message that the minimum wage increases must be capped to limit the impact on employment and competitiveness.”

The main findings from the survey were as follows:

  • 80% of businesses wanted a cap on future increases to be introduced.
  • 50% wanted the cap to be in line with inflation and 30% wanted it to be in line with national average earnings
  • 53.4% either agreed or strongly agreed that further large increases would adversely impact on staffing levels
  • 52.1% either agreed or strongly agreed that further increases would harm their competitiveness.


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