The Minimum Wage in the United Kingdom 2023
Compared to the 2022 rates, these represent significant increases of around 9-10% across all age brackets.
How Many People Are Affected?
In 2022, around 23% of jobs – over 7 million employees – across the UK were paid at or below the prevailing minimum wage rates.
With the April 2023 increases, the number benefiting will rise to over 3 million – made up of around:
- 2.6 million over 23s receiving the new £10.42 NLW rate.
- 350,000 21-22 year olds seeing a pay boost.
- 150,000 18-20 year olds earning more.
Minimum wage workers are concentrated in certain industries like retail, hospitality, cleaning, maintenance, childcare and food services.
Who Does the Minimum Wage Cover?
The minimum wage legally has to be paid to all eligible workers in the UK. The main exceptions are:
- The self-employed
- Volunteer workers
- Company directors
- Members of the armed forces
Almost all employees are covered, whether they are permanent, casual, agency, freelance or on a zero-hours contract. The employer is responsible for paying the minimum wage, not the client or agency.
Workers also must be at least of school-leaving age to qualify. For 2023, this is the last Friday in June of the school year they turn 16.
Impacts on Workers
The minimum wage has significantly increased pay for the lowest earners in the UK labour market. Around 300,000 workers benefited from the introduction of the minimum wage in 1999. The number receiving a pay rise from upratings of the NLW is now over 2 million.
However, not all minimum wage workers have gained equally. Research shows younger workers faced reduced employment opportunities from early upratings, while older workers gained. With the NLW, jobs held by younger workers have been replaced by those for over 25s.
The minimum wage is estimated to have had little impact overall on employment. But there are ongoing concerns it has encouraged employers to limit workers’ hours.
For those that have kept their jobs, the minimum wage has clearly raised pay. It has also reduced extreme low pay and poverty among households with minimum wage workers.
