Many small retailers will have to cut jobs or hours as a result of the new living wage, according to a snap survey by the British Independent Retailers Association.
Almost two thirds (63%) of respondents to a straw poll of a few hundred Bira members carried out at the beginning of this week said the pay hike would result in fewer jobs. Only 31% said their staff numbers would remain the same.
As announced in the summer budget on July 8, the minimum wage for those over 25 will rise from £6.50 per hour to £7.20 from April 2016 and to £9 by 2020.
The survey also suggested a third of Bira members were forced to cut employee numbers and hours following recent increases in the national minimum wage. The majority (90%) of those had a turnover of between £1m and £3m.
Bira chief executive Alan Hawkins said: “It will be a body blow to small shops if the government simply imposes this huge jump in cost on a sector already struggling to cope with falling prices, additional pension costs and ever increasing and punitive business rates.
“It emphasises the need for the Treasury to push ahead quickly with its promises to review and reform this damaging tax if small shops are to have a hope of coping with this unexpected new burden.”