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Minimum wage set to increase in October

In a move which has caused some concern among business leaders it has been revealed that the UK minimum wage will be increased by seven pence an hour to £5.80 from October this year. The rate for 18 to 21-year-olds will also rise by six pence to £4.83 and the rate for 16 and 17-year-olds will also increase to £3.57 which is a rise of four pence an hour. However, is it the correct course of action when you consider the ongoing economic downturn in the UK?

There is no doubt that the UK minimum wage has made a significant difference to the ability of many workers in the UK to pay their everyday bills and live a better lifestyle. However, business leaders had already indicated to the government that they would prefer to wait until a later date when the economy was more buoyant before bringing in any increases at all. There are many who believe the Labour government is now returning to a worker and union based policy mechanism as we approach the next general election. Whether this is correct or not is a matter of great debate.

It will be interesting to see how these increases in hourly rates will affect the employment numbers of those currently under the umbrella of the minimum wage.

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