Numerous pub, hotel and restaurant owners in Oxfordshire recently met at a roundtable lunch hosted by local accountancy firm, Wellers. One of the many topics discussed included the impact the Living Wage could have on their businesses.
The Living Wage currently stands at £8.55 per hour in London and £8.01 in Oxford, significantly more than the National Minimum Wage of £6.19.
In 2011, around 40% of part-time workers in the hospitality sector earned less than £7.19. It therefore stands as one of the industries to be hit hardest if the Living Wage becomes standard.
Stuart Crook of Wellers, who host the regular roundtable event which aims to address key issues and opportunities for the hospitality industry, says: “The increase could mean employment costs rising to 33-35% of a business’s cost base.
"This stood at just 21% 10 years ago and with rising pressure to compete with the promotional prices larger chains offer, it could have a major impact on many independent hotels, pubs and restaurants.”
The Living Wage for a city or region is based on an assessment of the real costs of living in that area, rather than the floor tariffs established by the National Minimum Wage.
Rather than passing on such a cost to the private sector, guests at the roundtable argued that councils should instead focus their attention on working with businesses. and creating the right environment for businesses to thrive through joint initiatives.
For more information on the Living Wage, click here.