'Growing concern' about 'pace' of minimum wage increases

A survey of Jersey employers has revealed 'growing concern' about the 'pace' of recent minimum wage increases.

Basic hourly pay has risen by around 63% over the last six years, with the decision on the next rate expected within weeks.

The current rate is £13.59 an hour.

The responses of the survey came from a wide range of sectors - including hospitality, retail, construction, finance, and transport.

While the results found broad support for the principle of a minimum wage and fair pay, employers are worried about the impact of the rising wage on labour-intensive sectors and smaller businesses.

Some businesses say it's also impacting their ability to employ young people, because it makes it increasingly difficult to justify creating roles for inexperienced workers.

The survey also sets out how businesses have had to increase prices, reduce profit margins, delay investment, and leave vacancies unfilled because of rising employment costs.

A majority of respondents have called for an independent review of Jersey's minimum wage framework to assess its benefits and potential unintended consequences.

The survey has also revealed 'substantial support' for specific rates or arrangements for apprentices, trainees, and young people in education, with many businesses arguing that greater flexibility would help preserve important pathways into employment.

Chamber President Eliot Lincoln said:

"Employers support fair pay and recognise the importance of ensuring workers are properly rewarded for the work they do. However, the survey shows growing concern about whether the current approach is achieving the right balance between increasing earnings and sustaining employment opportunities.

"Perhaps the most striking finding is the impact on young people entering the workforce. Businesses are telling us that opportunities for apprenticeships, traineeships, student employment and first jobs are becoming increasingly difficult to maintain.

"We are also hearing that the real cost of minimum wage increases extends beyond the minimum wage itself. Many employers are facing significant pressure throughout their pay structures as they seek to maintain appropriate differentials between new starters and experienced staff.

"Chamber believes there is a strong case for an independent, evidence-based review that examines both the benefits and unintended consequences of the current system. Any future approach should support fair pay whilst also protecting jobs, investment, training opportunities and Jersey's long-term economic competitiveness."

Chamber says it will talk to government, the Employment Forum, industry representatives and other stakeholders to make sure that the experiences of employers are fully considered as the next minimum wage decisions are debated.

The consultation on the next minimum wage closed last week. It has been reopened following controversy surrounding Deputy Gerald Voisin's comments over the summer.