BUSINESS and financial advisers Grant Thornton have urged firms to consider the advantages of the increase in the national minimum wage.
Graeme Whittaker, Entrepreneurial Business Services Partner for Grant Thornton's Manchester office said, "Many businesses will be dreading the
introduction of an increased national minimum wage to £4.50 per hour for adults and £3.80 per hour for youths.
"This will be particularly unwelcome in view of the rise in National Insurance contributions."
But he said businesses should take a long-term view.
"We know that finding and keeping good staff is one of the key challenges that businesses face," he said.
"We also know that pay is a critical factor for staff at the lower end of the pay scale when deciding whether to stay in a job or not.
"Therefore an increase in the National Minimum Wage may help to improve staff retention, as employees earn more and therefore feel more valued for the contribution that they provide.
"Recruitment is an expensive business, so for most companies, better staff retention will equate to more cost savings."
But he went on to warn companies against relying on pay increases alone to improve staff retention.
He said, "A pay rise is not always the best way to motivate and retain staff -- especially for employees higher up the pay scale.
"Providing flexible working conditions, taking advantage of tax incentives such as salary sacrifice schemes and other perks, such as gym membership, have also proved to be very popular."
BUSINESS and financial advisers Grant Thornton have urged firms to consider the advantages of the increase in the national minimum wage.
Graeme Whittaker, Entrepreneurial Business Services Partner for Grant Thornton's Manchester office said, "Many businesses will be dreading the introduction of an increased national minimum wage to £4.50 per hour for adults and £3.80 per hour for youths.
"This will be particularly unwelcome in view of the rise in National Insurance contributions."
But he said businesses should take a long-term view. "We know that finding and keeping good staff is one of the key challenges that businesses face," he said.
"We also know that pay is a critical factor for staff at the lower end of the pay scale when deciding whether to stay in a job or not.
"Therefore an increase in the National Minimum Wage may help to improve staff retention, as employees earn more and therefore feel more valued for the contribution that they provide.
"Recruitment is an expensive business, so for most companies, better staff retention will equate to more cost savings."
But he went on to warn companies against relying on pay
increases alone to improve staff retention.
He said, "A pay rise is not always the best way to motivate and retain staff -- especially for employees higher up the pay scale.
"Providing flexible working conditions, taking advantage of tax incentives such as salary sacrifice schemes and other perks, such as gym membership, have also proved to be very popular."
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