76% of construction industry unprepared for minimum wage rise

Many construction firms have done nothing to prepare for today’s rise in the national minimum wage, according to research by Bibby Financial Services.

The research shows that:

• 76% of construction owners and managers in the UK are in a state of inertia over the National Minimum Wage (NMW) hike.
• Most have failed to make any provisions for the increase even though the government claims that over one million people are set to benefit from it.

The minimum rate for adults aged 22 and over increases by 3.8% to £5.73 from today.

Bibby found that 16% of construction firms said that they would only begin thinking about the NMW rise once it happens.

“This is worrying at a time when the government is taking an increasingly tougher stance on employers who fail to abide by the legislation, threatening stiff fines and criminal proceedings for those who do not comply,” says Bibby. 

It found that of those firms in the construction industry which have made plans for the NMW:

• 10% look to cut costs elsewhere in their business to pay for the increase.
• 32% believe the NMW is more evidence of the government putting pressure on businesses through legislation.
• 7% state that the rise in wage costs will cripple their business. 

However, not all construction firms voiced opposition to the NMW hike with 45% reporting that they would like to see more increases, claiming that the legislation does not go far enough and many of the country’s construction workers are still not paid fairly.