​Why the End of Age Bands in Wages Is a Double-Edged Sword for Businesses

As I reflect on our industry's silence regarding the government's plan to overhaul minimum wage structures, I can't help but feel a mix of intrigue and concern. The government's move to abolish age bands for the National Living Wage is, without a doubt, a significant step towards fairness for young workers. Yet, while ethically sound, this decision raises critical questions about the financial implications for businesses, especially in sectors like the Fish & Chip industry.

Let's face it—if the government follows through with its plan, you could be looking at upwards of a 35% wage increasefor workers aged 18 and above. On the surface, this seems like a positive development—more money in the pockets of young workers, who often struggle with the same living costs as their older counterparts.

From a broader economic perspective, an argument can be made that higher wages could stimulate economic growth. After all, more disposable income often leads to increased spending, boosting demand for goods and services. However, the flip side is that this wage hike will almost certainly drive up prices in some sectors as businesses look to cover the increased payroll costs.

I've written numerous articles on the government's ambitions, and with the Labour government's first budget looming on 30 October, we won't have to wait long to see how this will play out. My gut feeling? We'll likely see the adult wage band becoming one, with the minimum wage increasing to just shy of £12 per hour. This isn't just a possibility—it's something businesses should start planning for right now.

So, what can you do to prepare? First and foremost, it's time to take a hard look at what your current workforce costs you and calculate the impact of this potential wage increase. This isn't just about crunching numbers; it's about making informed decisions to keep your business viable in the face of change.

Let's not forget that the hospitality sector and other industries have already expressed concerns over the affordability of these changes.

Our good friend Kate Nicholls, the chief executive at UK Hospitality, called for a fresh round of consultation with businesses, particularly on potential pay rises for younger workers, saying: "It would have been far more pragmatic to wait and make these changes in 2026. "With a new remit now in place, the LPC must recognise that the 20 per cent increase to wage rates over the past two years clearly accounted for the cost of living. I would urge them not to recommend yet another significant increase, which would raise serious questions over affordability."

The LPC (Low Pay Commission) has been tasked with considering the impact on business, competitiveness, and the wider economy. Yet, even with these considerations, we'll likely see some tough adjustments ahead.

This policy shift highlights a broader trend: the increasing pressure on businesses to absorb the costs of social progress. The principle of a living wage for all workers is commendable, and as a society, we should strive to ensure that work pays enough to live on. However, we must also balance this with the survival and growth of the businesses that provide these jobs.

Removing age bands may be a step towards greater fairness, but it also represents a challenge we must navigate carefully. Now is the time for businesses to adapt, plan, and prepare for what's to come. The autumn budget will provide more clarity, but the smart move is to start bracing for impact now.