Increase to the National living wage to benefit thousands of security workers

There is good news for millions of workers during the cost of living crisis as the national living wage increases to £10.42 next year—a 92 pence jump or 9.7% increase. With inflation running at 9.6%, the national living wage has taken its steepest increase in years. It means that those earning the full-time national living wage can expect an extra £1,900 per year to offset the increases in food, petrol, energy and other goods. 

Security jobs are often offered at the minimum wage, with increases above this paid for additional experience, qualifications, duties, and responsibilities. So, what can you expect if you are currently working in security and earning either the national living wage or a higher salary due to experience and skills? 

Maintaining pay scales

It has often been difficult when the minimum wage rises for companies to know how to keep fair pay scales while dealing with increases in wage costs. This can be particularly difficult when a company has the vast majority of its staff on the minimum wage. 

It may have bosses wondering how to keep labour costs down, especially while attempting to keep pay scale increases. For example, consider a restaurant that pays their front-of-house staff the current minimum wage of £9.50 but pays basic cooks £1 more since they don’t get tips. It also pays front-of-house head waiters the same £10.50 rate due to their increased experience and value. 

Next year, when the restaurant must increase entry front-of-house staff wages from £9.50 to £10.42, they are not obliged to increase the basic cook’s or head waiters’ wages by an extra 92 pence from £10.50 to £11.42. This would leave experienced head waiters and basic cooks disincentivised with only 8 pence instead of £1.00 more than new front-of-house staff. Of course, bosses would want to increase all salaries so that disharmony doesn’t set in among employees, but they may be unable to afford it. 

In terms of security work, many places of employment include companies such as nightclubs and retail outlets. These companies employ hospitality, security and retail staff, all of whom are also lower-income workers that are likely to be affected by the increase in the national living wage. Companies might try to keep track of increasing wage costs by not honouring pay scales, so if you have already achieved a pay increase since you started, you may not see your wage increase anymore or by a smaller increase than 92 pence or 9.6%. Companies might also attempt to save costs by sticking to age minimum wages if they have not previously been doing so. 18-22 old workers, that had previously been enjoying a standard national living wage for 23+year-olds might find that a squeeze on labour costs could mean they only receive a minimal pay increase to £10.18. And 18-20-year-olds could even have their wage decreased to £7.49!

Minimum wage rates from 2019-2023

Will I be better off?

The good news is that while the living wage pay increase for 2023 is significantly larger than previous jumps, firms have been used to increasing their wages annually. They, therefore, have experience managing pay scales and grades and adapting as wages rise. 

The UK is experiencing its highest rate of price inflation in forty years, and with this also comes wage inflation, as wages try to stay on track with prices so that people are not effectively worse off. Companies have been well aware that wages would have to rise significantly this coming year and, in due course, will increase their prices if needed to pay salaries. This often creates a cycle of rising prices, wages, prices, and so on, with no real increase in disposable income. Until outside inflationary pressures, including significant energy and wheat supply issues due to the war in Ukraine, the UK government will have to manage inflation carefully. You should also be careful to budget if you are earning a full-time living wage of £21,600, as you will be taxed an additional £419, on your salary reducing the gross £1,900 increase to a net increase of £1,500.

However, the good news is at least lower-income workers will have an increase in their pay packet to cover price increases.  We also expect experienced firms to be able to keep their pay scales competitive and incentivising. If your firm is not going to increase your wage rate to your desired amount, then it might be time to look around. Remember, there are always new roles available weekly at Get Licensed.