Hospitality workers already paid more than new national living wage

31/10/2018 - 10:39
The National Living Wage (NLW) is to increase to £8.21 per hour for over 25-year-olds next April – but UK hospitality workers are already on average paid more than this, at £8.60 per hour.

This comes from industry software provider, Fourth, who analysed hourly pay of ‘thousands’ of hospitality workers across the country following the Chancellor’s Autumn Budget announcement (29 October).

With the average hourly pay of hospitality workers aged 25+ in the UK currently at £8.60, it is already 39p above the new £8.21 threshold (set to be implemented next April).

The 4.9% rise equates to 38p – taking the current £7.83 minimum wage to £8.21.

But it doesn’t stop there - Fourth also revealed that hospitality workers of all age cohorts are currently earning higher than their respective new thresholds:

  • The average pay of 21-24 year-olds is £8.35 (Sept 2018) – 65p higher than the new threshold of £7.70
  • For 18-20 year-olds, it’s £7.37 (Sept 2018) – £1.22 higher than the new threshold of £6.15

  • Under 18s receive £6.52 (Sept 2018) - £2.32 higher than the new threshold of £4.35

That said, workers in Europe and the rest of the world (ROW) are typically paid more than their British counterparts.

In the six months from March-September 2018, UK workers’ wages rose by 5% from £7.73 to £8.12; while EU workers’ wages rose by +5.2% (£8.08 to £8.50) and +4.2 in ROW (£8.52 to £8.86).

What’s more:

  • Quick service restaurant (QSR) employees earn the most in the UK - £9.08 per hour (September 18)
  • Pub workers £8.43 an hour (Sep. 18)
  • Restaurant workers £8.26 an hour (Sep. 18)

Although front of house wages rose by 0.2% more than back of house during the same period (+5.2% compared to +5%), the latter still earns more at £8.75 - rather than the £8.05 front of house hourly rate.

Fourth analytics and insight solutions director, Mike Shipley, commented: “These statistics clearly reveal that hourly pay in the hospitality industry is currently significantly outstripping increases to the National Living Wage.

“Considering hourly wages of hospitality workers increased by 4.8% over the last six months, it’s likely the gap between real wages and the new thresholds will be further exacerbated between now and April. 

“Attracting and retaining quality employees is one of the biggest challenges hospitality operators now face, and with a well-documented shortage of labour, particularly in skilled back-of-house roles, operators are offering competitive rates alongside development programmes, incentives and other initiatives to attract the best employees, which are all driving up costs.

“While the statistics reveal that EU and ROW workers earn more than workers from the UK, the large numbers of EU and ROW workers in skilled back of house chef roles in the quick service and restaurant industries has significantly driven up their average wage per hour, particularly with the ROW where a number of specialist overseas chefs command higher wages, impacting the figures.

“With our industry’s heavy reliance on skilled workers from the EU, a reduction in the supply of labour from these countries – which we are already experiencing – will continue to drive up wage inflation, further impacting hospitality margins.

“To mitigate this, we are increasingly seeing companies turn to technology to gain greater transparency on all aspects of their business, including the make-up of workforce, in addition to improving efficiency through smarter scheduling and forecasting.”

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