The Association of Convenience Stores (ACS) has criticised the Government’s decision to Increase the National Minimum Wage from October 1.

The Government announced that the adult rate for national minimum wage will increase by 1.9% from £6.19 to £6.31 per hour, and the youth development rate for 16-17 year olds will go up by 1% to £5.03 an hour.

ACS chief executive James Lowman said: “This increase will result in reduced employment and act as a barrier to growth for thousands of local retailers. In the current economic climate, the right decision for businesses would have been to freeze minimum wage.

“Our research has shown that retailers have little choice but to reduce staff hours and delay further business investment when the minimum wage is increased.”

ACS called on the Low Pay Commission and the Government to freeze the adult national minimum wage rates for 2013-14.

It estimates that the actual minimum cost per hour to a retailer for a full-time adult employee will be £7.23 per hour when holiday entitlement and national insurance contributions are taken into account.

Key findings from ACS research highlighting the impact of increase in National Minimum Wage are:

• 80% of retailers are reducing staff hours;

• 78% of retailers are increasing the hours they work;

• 67% of retailers are delaying expansion or investment plans.