After the UK’s Night Time Industries Association issued a statement yesterday interpreted by some to be “punching down” on lower paid workers, the trade organisation’s CEO Michael Kill has clarified to CMU that that was definitely not the intent.
The NTIA’s latest statement has again called for further government support for the night-time sector, specifically noting the impact of the latest increase in the UK minimum wage which went into effect this week.
Keen to clarify that the NTIA is not opposed to the wage increase in principle, its CEO Michael Kill told CMU, “The night-time economy and hospitality sector is the largest employer of those under 30 and we are steadfast in our commitment to ensuring fair wages for workers within the industry and recognising them as its greatest asset”.
However, Kill added, the increase in minimum wage basically offsets the benefit of the extended business rates relief that the UK government announced in its recent spring budget. The UK minimum wage for workers over the age of 21 - aka the ‘national living wage’ - is now £11.44 an hour following a 9.8% increase earlier this week.
With the increase in wage costs, night-time businesses are still facing significant challenges despite the extension of business rates relief, as other operational costs also increase and the cost of living crisis impacts on customer spend. Hence the NTIA statement calling for further government support.
Kill told CMU, “In real terms, the increase in the national living wage by the government presents unprecedented challenges for businesses operating within the sector, pushing operational expenses to unprecedented levels at a time of crisis. Particularly for independent enterprises, the surge in costs presents immense hurdles, exacerbating the already daunting landscape they navigate”.
“While the government’s extension of business rates relief, announced in the spring budget, is acknowledged and appreciated”, he added, “it provides only temporary respite. The relief, barely covering the cost of the national living wage increase for the next twelve months, offers little consolation to the countless businesses grappling with intensified financial pressures”.
“It is a poignant irony that, while business support is extended in one hand, it is swiftly retracted through increased wage obligations”, he continued. “This imbalance not only threatens the very essence of our vibrant nightlife sector, but the jobs and wellbeing of the workforce we are trying to protect, posing a formidable challenge to its sustainability”.
“We call for a continued dialogue and collaboration between the government, industry stakeholders and policymakers to address the balance, and to acknowledge the injustice and move towards providing further support to businesses to allow them to survive under the current cost challenges”.
NTIA's original statement, issued at 5.30pm on 3 Apr reads:
NTIA Raise Concern on the Impact of the National Minimum Wage on Night Time Economy Businesses
Statement from Michael Kill, CEO of the Night Time Industries Association on Impact of National Minimum Wage on NTE Businesses.
Today, as the new national minimum wage comes into effect, I am deeply concerned about its implications for businesses within the night time economy. This increase places an overwhelming burden on establishments already struggling to stay afloat amidst challenging times.The reality facing our members is daunting. The sudden surge in staff costs adds an additional layer of complexity to an already delicate financial balance.
While the government's gesture of extending business rates relief is appreciated, it provides little solace to the countless businesses grappling with the intensified pressure on their bottom line.
It's a bitter irony that while on one hand, support is extended, on the other, it is swiftly retracted through increased wage obligations. This imbalance threatens the very fabric of our vibrant nightlife sector.
As CEO of the Night Time Industries Association, I urge the government to recognize the urgency of this situation.
This followed a previous statement regarding the National Live Wage increase issued by the NTIA on 2 Oct 2023:
NTIA Comment on National Living Wage Increase Announcement
Following the announcement by the Chancellor Jeremy Hunt on the increase in National Living Wage to £11.00. Statement from Michael Kill, CEO of Night Time Industries Association:
We're deeply disappointed by the Chancellor's announcement on the National Living Wage increase, and we see it as a token gesture that's timed at our industry's expense. It's nothing short of a slap in the face for our already struggling businesses.
The night-time economy has been battered by the pandemic, with our venues facing closures, restrictions, and crippling financial losses. Now, just as we're trying to get back on our feet, the Chancellor decides to unload the burden of a wage increase squarely onto the shoulders of operators.
This move effectively erodes any positive impact from the current business rates support, and it shows a complete lack of understanding of the night-time sector's fragile state. While we support fair wages, the timing couldn't be worse. It's a cynical attempt to score political points at our expense.
We call on the government to engage with us, the Night Time Industries Association, and other stakeholders in our sector. Let's discuss a more sensible, phased approach to implementing this wage increase. Our industry is struggling to survive, and we need a government that truly understands and supports us.