What Will The Minimum Wage Increase Mean For Me?

Come April, young employees have a lot to look forward to as their minimum wage is set to rise by a whopping 16%. A welcome move and a huge relief for young people who are pursuing apprenticeships and are employed in the age groups of 16-20 years. 

They will see the national minimum wage go up to £10 per hour, up from £8.60. The national living wage also goes up from £11.44 an hour to £12.21 for those employed above the age of 21 years.

So, how does this impact your hard-earned money and what does it mean for your professional life? Well, the introduction of this wage increase is to help employees, especially individuals tackling the cost-of-living crisis. 

This is a positive change that will help elevate the socio-economic status of wage earners across industries and businesses.

So, the following article will help you understand how the minimum wage increase will impact employees. Focusing on the impact it will have on your financial health. 

Impact of Minimum Wage Increase on Employees

Trying to wrap your head around the impact this exciting minimum wage increase will have? Let us help you! The following section lays it all out for you and helps you understand the impact this increase will have on your life: 

1. Planning for Personal Finances

A minimum wage increase is great news for your pocket and savings! This is especially great for you if you’ve been living paycheck to paycheck. This increase will provide significant relief. 

However, with the continuous rise in household expenses, employees are also juggling the cost of utilities, transport and food. So, while you wait for the minimum wage increases to be implemented, you can consider an employed salad loan to manage day-to-day expenses better. 

This can be particularly helpful if you’re living paycheck to paycheck.   

Although an increase in the minimum wage is likely to positively impact your finances, you still need to consider budgeting effectively. 

This will maximise your paycheck ensuring that any extra money resulting from the potential increase in minimum wage will be allocated wisely. 

A wage increase is a good time to consider buying insurance and saving for a rainy day. 

2. Impact on Employment

You can expect to see a change in the employment landscape with a rise in minimum wage. However, these could go either way. Studies suggest that an increase in wages generally acts as an incentive for workers to be more productive and efficient. 

As a result, employers may witness reduced employee turnover and improved job satisfaction.

On the downside, a minimum wage increase could also result in employers considering automation tools and technologies to cut costs, save time and minimize errors. 

This could help employers manage their budgets better and reassess existing staff roles to cut down work hours, if not laying off employees.

Therefore, with higher labour costs, you can expect to see many employers considering streamlining their operations with automation to tackle wage increases. This could mean a shift in job roles or reduced work hours for you.

3. Better Standard of Living

An increase in minimum wage can mean an increase in disposable income for you. This means you can access better services and afford necessities a lot more comfortably than you previously have. 

While the challenge of rising costs may not cease immediately, with a minimum wage increase you’ll be able to cover transport, housing and utilities costs without much financial stress.

You can consider using the extra income to invest in your career growth or personal development. This can be done by pursuing further education, acquiring new job skills or joining professional associations for career advancement. 

By doing this, you can access better job opportunities that offer social mobility. This can help boost your professional and personal network. 

An increased disposable income can also allow you to indulge occasionally and experience stress-free living. However, it’s important to remember that even with a significant increase in your wages. 

It’d be wise to continue living frugally and make savings a priority.

4. Improved Health Outcomes

Health outcomes are greatly boosted as an increase in minimum wages benefits both individuals and communities at large. Financial stress is generally one of the biggest causes of mental health issues and can adversely affect your overall health.

However, with an increase in the minimum wage, you can offset these financial stresses considerably. This leads to better mental health outcomes and a considerable reduction in stress-related ailments. 

You can be proactive about your health and make use of your pay increase to access healthier foods. This allows you to have a healthier lifestyle and body, reducing potential medical and treatment costs. 

With a wage increase, you’ll also face fewer temptations to use smoking or drinking excessively as a coping strategy. A healthier lifestyle will boost your psychological well-being and improve your sense of confidence and security.

5. Self-Sufficiency and Less Dependence on Government Assistance

Government programs and measures to tackle the cost-of-living crisis have been helpful for millions across the country. The last autumn budget in particular made provisions to lend greater assistance to people. 

Especially in low-income groups to afford utilities, rent and transport costs. The ‘household support fund’ for example gave local councils funds to help people afford essential items.

However, this has greatly added to the fiscal burdens of the government, hampering the development of public services and other developmental projects. 

An increase in minimum wages means you have a better chance at self-sufficiency, reducing dependency on government aid.

Therefore, a minimum wage increase can improve your financial resilience and independence while making for a more equitable and inclusive society. 

For those in low-income families, this boost in take-home pay can be enough to lift you out of a low standard of living and improve household incomes.

Minimum Wage, Maximum Wins! 

You can look forward to an improved household income and take-home pay with an increase in minimum wage. For young employees, this can mean investing in personal development and career growth while for others. 

It can include improved standards of living. Either way, you’re looking at potential improvements personally and financially in the coming year.

We hope this article has helped you understand how the minimum wage increase will impact you positively in the upcoming months.