LPC recommendations take the National Living Wage to £13.21
The UK Government will raise the National Living Wage to £13.21 from April 2027, accepting Low Pay Commission recommendations that also lift younger worker rates to £11.27 and £8.31.
The Government confirmed today that the National Living Wage for workers aged 21 and over will rise by 3.9% to £13.21 from April 2027, aligning with recommendations from the Low Pay Commission. The increases for younger workers aged 18–20 and apprentices will also match the 3.9% uplift, reaching £11.27 and £8.31 respectively. The decision follows consultations with employers and workers amid economic uncertainty, balancing wage growth with business resilience. The Government noted that while the increase does not yet meet the two-thirds median earnings target, it protects real-term value against inflation forecasts for 2027–28.
The Low Pay Commission highlighted the challenging economic conditions, including weak hiring despite better-than-expected growth, and concerns over potential energy price shocks. Commissioners emphasised that the recommended rates were based on comprehensive economic evidence and negotiations to ensure fairness for both workers and employers. The Government accepted the advice in full, acknowledging the need to support household incomes while avoiding undue strain on businesses. The NLW increase remains below the long-term target but is designed to maintain purchasing power over the coming year.
For younger workers, the Commission recommended pausing further alignment of the 18–20 rate with the adult rate due to slower demand for youth labour and heightened economic risks. The 18–20 rate will rise by 42p to £11.27, a 3.9% increase, while the 16–17 rate will climb by 31p to £8.31. The Commission noted that employment for 16–17-year-olds has declined in recent years, though it did not attribute this directly to minimum wage rises. The apprentice rate will also increase by 31p to £8.31, reflecting broader concerns about apprenticeship costs among employers.
The Low Pay Commission published its formal advice to the Government alongside a report detailing the evidence underpinning the recommendations. The Commission stressed that future increases for younger workers and apprentices would require careful consideration due to ongoing labour market uncertainties. The Government’s acceptance of the recommendations underscores its commitment to gradual progress toward the two-thirds median earnings target while prioritising youth employment and economic stability.