The start of the new year is often a time when we reflect on the events of the past 12 months and look ahead to what the next year may hold both in terms of opportunities and challenges.
This year will see the new government make its mark not only by addressing Brexit but also with actions on a number of domestic policies that will directly affect the convenience sector. We were given an insight into their plans in their manifesto where the Prime Minister pledged changes to the business rates system, tackling crime and wage rates.
So it was no surprise when over the festive period the Low Pay Commission announced that the minimum wage would increase by four times the rate of inflation from £8.21 to £8.72 from April 2020. This meets the target set by the government in 2015 of the National Living Wage reaching 60% of median earnings by 2020.
Of course these increases will have a very real and significant impact on forecourt and convenience retailers, and make no mistake this is the biggest financial challenge facing our members. Our annual National Living Wage survey found, once again, that the wage increases in April 2019 had a significant effect on retailers and their businesses; almost three-quarters of retailers reduced the number of working hours in their business and over half of retailers had to take on more hours themselves in order to make up for the shortfall.
While it is right that the government should address how to support colleagues to progress beyond low-paying roles and tackle one-sided flexibility where it exists in the labour market, it is vital that any measures introduced do not penalise local shops and the flexible and secure employment opportunities we provide in local communities.
As politicians pledge to increase these wage rates yet further, we’ll be explaining why above-inflation rises will undermine jobs and investment, and why ultimately it’s better to support jobs in the secure and ethical convenience sector than to transfer them to the gig economy. Expect this to be a defining issue in the coming parliament.