The introduction of the new living wage this week, whilst a boost in pay for many workers at the bottom of the pay scales, will pose a problem for companies seeking not to pass costs on to customers.
From April 1st, the new living wage for workers aged 25 and over will be £7.20 an hour.
One of the areas that will be impacted negatively is food manufacturing. The Barker Ross Group, specialists in recruiting for manufacturers, has been working with clients in advance to find methods to mitigate extra costs. Speaking about its initiative is Barker Ross chief executive, Paul Ross:
“The introduction of the living wage on the food manufacturing sector is without doubt hugely significant in terms of increased costs.”
“A number of our clients have been engaging with us on how the impact can be mitigated across their businesses as it won’t be possible to just pass the costs on.”
“We have been working with manufacturing consultants with particular expertise in continuous process improvements. This has led to us helping our clients develop projects to improve overall productivity and reduce wastage. In addition, we have been seeing if we can improve training to help with reducing the overall cost per unit.”
“Working hand in hand with our clients means we develop an understanding of their overall business processes and can help measure the true cost of labour. We can’t afford to just recruit; we need to be really adding value to help clients find solutions and be true partners.”
“Although this has always been Barker Ross’s approach, enthusiasm from clients and results of this project have been extremely exciting. Barker Ross firmly believes that this is an appropriate response to the ever-increasing costs of manufacturing wages”