Retailers have expressed concern that an upcoming rise in the national living wage will force staff cuts, leaving already-stretched retailers struggling with their mental health. 

The comments come after chancellor Jeremy Hunt announced a 10% boost to the National Living Wage from £9.50 to £10.42 per hour as part of the government’s autumn statement last month. The change will come into force in April 2023. 

However, retailers have told Better Retailing that while they want to pay staff living wages, rising operating costs have left many considering staff efficiencies. 

Premier retailer Vince Malone, The Fed‘s district president for Wales, said: “I want to pay my staff a reasonable wage. I want them to survive because their bills are going up, too. For many businesses, however, the wage bill is the biggest expense and it comes off the bottom line. Many, like myself, will be looking at whether they can make efficiencies, such as reducing hours.” 

Malone warned the knock-on effect of this may also push business owners to their limits as they juggle increased hours. 

He added: “Many of these businesses are family-run, and owners already work incredibly long hours. They will take more on themselves because they cannot afford to employ people. 

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“They will run themselves into the ground doing 90-hour weeks. In my district, members are already raising issues about mental health.” 

The Fed’s national deputy vice-president, Mo Razzaq, said his wage bill would increase by £3,000 next year, prompting him to review his staffing strategy. 

“The government hasn’t done us any favours on this,” he said. “Many retailers facing a cost-of-trading crisis will be asking staff to do more, looking at cutting hours and taking on more themselves. 

“There is an emotional pressure of feeling responsible for staff’s well-being, but also we are coping with increased demands from customers to donate food and groceries. If the government thinks small business is the land of milk and honey, it is not.” 

According to a recent report by charity GroceryAid, calls to its helpline increased in 2021 by 42% in the independent sector compared with the previous year. Financial support to independent retailers increased by 124% with almost half of that given in crisis loans. 

A spokesperson said: “Independent retailers can call the GroceryAid helpline 24/7, 365 days a year, and receive immediate support from a trained counsellor about their concerns. We also have a communication toolkit for independent retailers to use within their premises to inform their employees about the support they can access.”