A new minimum wage rate of £6.12 an hour for workers over the age of 21 comes into force today (1 October.) The rates for those under 21 remain at £4.98 an hour for 18 to 20-year-olds and at £3.68 an hour for 16 and 17-year-olds. The rate for apprentices rises by five pence an hour to £2.65.
The TUC says that this means the lowest paid will suffer a real terms pay cut as inflation is running at 2.9 per cent
Commenting on the new rates, TUC General Secretary Brendan Barber said: "While we are pleased that government has rejected the siren calls of some employers to freeze the minimum wage for adult workers and apprentices, these increases are still far below inflation and will leave the lowest paid facing a real terms cut.
"These new rates are a particular blow to younger people who will face the biggest hit on their living standards. There is no evidence that the minimum wage has had an adverse impact on young people's employment so it is hard to see the logic behind their pay freeze.
"Today's rate increases do not do enough to help hard-pressed families. We need a bolder increase next year otherwise the real incomes of minimum wage workers will continue to fall, along with consumer demand."
The minimum wage was introduced in 1999 at £3.60 an hour for adults. The level is recommended each year by the Low Pay Commission.