Window makers face pressure to lift skilled operatives’ pay as minimum wage rises erode long-standing differentials.
Skilled and semi-skilled workers on Britain’s window production lines are watching their pay premium vanish, as successive minimum wage increases push entry-level rates towards those of experienced fabricators. John Healey’s Budget on Wednesday confirmed a 3.9 per cent rise in the national living wage to £13.21 an hour from April. For a 40-hour week that equates to about £27,480 a year. Add employer national insurance at 15 per cent above £5,000 and minimum pension contributions, and a full-time worker on the wage floor will cost roughly £31,500.
Speaking exclusively to Glazing Today Brian, a managing director at a midlands-based PVC-U fabricator employing 90 people, explains that fabricators on the cutting and welding lines have historically earned about 10 per cent above the floor. Holding that gap means lifting their rate to £14.53 an hour, taking the all-in cost of each skilled operative to about £34,700.
“Being in the Midlands there is a high density of fabricators so we always run the risk of losing workers to competitors. It is a very price sensitive market. If we take on any workers on minimum salary, we will need to increase the rate for our skilled workers who will demand a deferential from base workers. If we don’t they will become targets for competitors who may be increasing their rates accordingly. The bottom line is this budget will no doubt lead to an increase in our labour cost at a time when we are fighting against squeezed margins due to market forces and rises in material and energy costs.” said Brian.
HR analysts at Brightmine have called the effect “squeezeflation”. They warn that statutory rises absorb budgets that would otherwise fund mid-level pay.
The picture is different at the bottom of the ladder. School leavers start in the stores, picking hardware and staging profile, before moving on to cutting and welding. They are cheaper to employ. The 18 to 20 rate rises to £11.27 and the apprentice rate to £8.31, and employers pay no national insurance on most under-21s. Healey held the youth increase to 3.9 per cent rather than pressing on with faster convergence towards the adult rate.
That still leaves a cliff at 21, when trainees move to the full rate, often before they are fully productive on the line.
Shevaun Haviland, director-general of the British Chambers of Commerce, said most businesses would not notice the Budget at all. Fabricators will notice it on next April’s payroll.
