Employers aim to improve productivity in response to Living Wage

Ahead of the introduction of the National Living Wage on 1 April 2016, the Recruitment and Employment Confederation (REC) has released data showing how employers are likely to respond to rising wage bills.

State300“Responding to the findings, REC head of policy Kate Shoesmith commented: “Many employers are adopting a ‘wait and see’ approach to the National Living Wage, with 40 percent saying they will take no action and a further 10 percent saying they don’t know what their response will be. A significant proportion of businesses will not be affected by the first NLW, but the government has pledged to raise the rate to at least £9 by 2020 – this is likely to impact many firms’ longer-term hiring strategies.”

A survey of 191 employers found that:

A fifth (19 percent) will invest in training or take measures to increase staff productivity

Four in ten (39 percent) will take no action

14 percent will take on fewer staff than planned

8 percent will reduce staff overtime and bonuses

2 percent will make redundancies