The Fed continues call for government to consider impact of above-inflation wage cost rises on small businesses

(Pictured: The Fed’s President, Hemanshu Patel)

The Fed has once again called on the government to carefully consider wage pressures for small businesses ahead of next week’s budget, following a series of above-inflation increases in the minimum wage.

The Fed represents thousands of independent shops who are key drivers of employment across the UK and are responsible retailers. However, the Fed has sounded the alarm bell in recent years following a series of rising mandatory minimum costs above inflation, including accelerating minimum wage rises which rose 6.7% and then 4.5% in 2025 and 2026 for those aged over 21 to £12.71 an hour. It also came after a huge 16.3% and 8.5% hike for those aged 18-20 years old, to £10.85 an hour a factor the Fed fears is contributing to the youth employment crisis.

The Fed’s National President raised the issue with the Chancellor John Healey MP in a letter sent just days after he took office in the new government headed by Prime Minister Andy Burnham.

The Fed’s national president Hemanshu Patel said: “Fed members are responsible retailers who contribute to employment and work hard to support their local communities. However, for our members to continue to grow their businesses, create jobs and provide a familiar face in the social fabric of the communities they serve, it is important that the Government carefully considers rising costs ahead of the Budget. This includes ensuring that next year’s National Minimum Wage and National Living Wage increases, to be announced next week, are set at levels that retailers and other businesses can afford, helping them to protect existing jobs and support future employment.”