The rise in the UK national minimum wage from October will cause problems for many small shop owners already struggling to make a living, the results of The Grocer's latest poll indicates.
Last month the government announced that retailers would have to increase the minimum hourly rate they pay their staff from £5.52 to £5.73, which amounts to an above-inflation increase of 3.8%. Many polled say that this increase would put a further strain on their already tight margins.
Only 25% of shop owners we spoke to agree their staff should be paid the higher wage from October, with the majority of stores saying they did not believe such a high rise in the minimum wage was necessary. "The cost of living is going up for people, so they should be paid more, but my cost of living has gone up as well, as has the cost of running my business, so I get a double hit," says one retailer. "It's too high a wage increase."
The Association of Convenience Stores and the Rural Shops Alliance has condemned the above-inflation raise as too high for businesses.
"Why are we expected to afford pay increases greater than those the government is prepared to pay itself?" says ACS chief executive James Loman. Wages make up half or more of the total overheads of many rural village stores and the increase will force many small rural stores to close, adds Ken Parsons, RSA chief executive.
Forty per cent of retailers say they will face problems as a result of the wage increase. "We open early in the morning until late at night so we need a lot of staff to cover the shifts," says one retailer. "Any increase is going to cause problems for us and business is already tough."
Some store owners in larger towns say they already pay above the minimum wage and that October's increase will have only a small effect on them, but of those that do pay higher wages not all agree that the national wage should rise by so much. "We set our own wages, which are slightly higher than the minimum wage, but it's our own choice to do so. I don't think forcing shopkeepers to pay more is fair on everyone. It depends how the business is running."
Despite the wage increase, most store owners say it will not affect their staff numbers come October. "We employ the number of staff we need to run the business, so the staff will stay the same," says one.