The National Minimum Wage in 2020
National Living Wage and National Minimum Wage rates increased on 1 April 2020. This report reviews those increases and the LPC's new remit to 2024.
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This short report accompanies the 2020 increases in the National Living Wage (NLW) and National Minimum Wage (NMW). This year’s increase in the NLW, to £8.72, brings the rate to the target of 60 per cent of median earnings, originally set in 2015. The report looks at the effect of the National Living Wage over time on pay and employment over that time period.
The Government has set a new target for the NLW to reach two-thirds of median earnings by 2024. The report sets out how the LPC will approach its new remit and the higher target. We have not, at this stage, set out a projected pathway to the 2024 target, given uncertainty about the impact of the ongoing Covid-19 outbreak.
NLW and NMW rates from 1 April 2020
| Previous rate | Current rate from 1 April 2020 | Increase | |
|---|---|---|---|
| National Living Wage | £8.21 | £8.72 | 6.2% |
| 21-24 Year Old Rate | £7.70 | £8.20 | 6.5% |
| 18-20 Year Old Rate | £6.15 | £6.45 | 4.9% |
| 16-17 Year Old Rate | £4.35 | £4.55 | 4.6% |
| Apprentice Rate | £3.90 | £4.15 | 6.4% |
| Accommodation Offset | £7.55 | £8.20 | 6.4% |