In 2019, the Low Pay Commission (LPC) recommended that workers should become entitled to the National Living Wage (NLW, the highest rate of the minimum wage), at the age of 21 instead of 25.
In April 2021, the first steps to achieving this, the age of entitlement was lowered to 23. This meant that 23 and 24 year olds moving to the NLW saw a much higher increase in their minimum wage than other age groups in 2021.
Researchers found that 23-24 year olds were no more or less likely to be employed in the year after they became entitled to the NLW.
The Low Pay Commission (LPC) expect to go ahead with the further change in the age threshold for the NLW – to age 21 – in April 2024.
Research has found that 23 and 24 year olds’ employment remained strong after they became entitled to the NLW and reassures the LPC that it is possible to do this without harming employment prospects for 21 and 22 year olds – both employers and workers – continue to tell the LPC that it is the right thing to do.
While 21 and 22 year olds are different to 23 and 24 year olds, most employers already pay 21-22 year olds at the adult rate: 85 per cent of 21-22 year olds were paid at or above the NLW in April 2022. The LPC has recommended a large increase in the 21-22 rate this year, to smooth the transition on to the NLW. This will leave the difference between the two rates at only 24 pence per hour.
PAYadvice.UK 12/4/2023 updated 14/4/2023
