Business owners fear impending rise in minimum wage

North West business owners are fearful as the UK national minimum wage rises on 1 April.

According to research by the Northern Business Exhibition two out of five business owners expect the rise in minimum wage to have direct impact on profitability and turnover over the coming weeks, and 40% surveyed feared the rise in minimum wage could put their business at the risk of closure due to the spiralling running costs over the last six months - 15% said their business was already in decline. 

Just one in ten said that the changes in minimum wage did not put their business in risk of closure. 

Of those asked, two thirds of business owners were aware of the changes to minimum wages on 1 April.

As a direct result, business owners are already preparing to take action, a quarter of those questioned said they would be increasing their prices whilst one in five thought they would be cutting down on unnecessary staff hours to keep the wage bill down. One in three said they would be cutting down on other business costs to accommodate the rise in wages.

Retailers (31%), restaurants and bars (28%) and manufacturers (32%) are expected to feel the most impact. 

Nine out of ten business owners raised concerns over the current state of the British economy, saying that things could be better. Just one in ten felt that business was booming.

Hilary Devey, keynote speaker for the Northern Business Exhibition, said: “It’s a critical time for business owners at the minute having to adapt to change quickly to safeguard their business – overheads have been rising considerably over the last six months and the end consumer is already feeling the pinch on their pocket.

“Businesses are having to work harder to turn a profit, we’ve seen some big names fall victim to this who have perhaps not been able to react to change at the same pace others have.”