The national living wage is the minimum rate that employers are allowed to pay their employees for each hour worked, in accordance with government legislation.

The Chancellor recently announced that the National Living Wage will increase by 2.2 per cent this year, from £8.72 to £8.91. For the first time, this wage increase will also be extended to 23 and 24-year-olds, as currently, the national living wage is only available to those aged 25 or above, meaning full-time workers above the age of 23 will see their wages rise by £345 next year.

Rishi Sunak confirmed the increase in his Spending Review 2020, which was set out in Parliament a few days ago. The Chancellor originally said payslips were expected to rise from £8.72 to £9.21 in April next year, however the increase is now less due to the coronavirus crisis.

The rise of 2.2% is a 19p increase this year and is part of a wider Government plan to extend the national living wage to cover workers aged 21 and over by 2024.

See the latest increases:

Stats taken from www.gov.uk/government/news/national-living-wage-increase-to-protect-workers-living-standards

The national living wage is different from the real living wage. The Real Living Wage is a recommended UK wage rate, which is a voluntary amount that companies choose to pay their workers. This was boosted by 20p to £9.50 per hour for workers outside London and boosted by 10p to £10.85 in London. Over 700 additional employers have signed up to the real Living Wage since the start of lockdown in March.