Equal Pay for Under-21s Faces Pushback as Employers Warn Over Entry-Level Jobs

Nearly half of employers surveyed by the Recruitment and Employment Confederation (REC), the UK trade body for recruitment businesses and employers, expect higher costs if minimum wage rates for younger workers move closer to the adult rate. The findings come as Labour pursues its commitment to remove age-based minimum wage bands for adults.

The REC survey of 235 employers, carried out by Whitestone Insight in September 2026, found that 48% expected costs to rise if the pay gap between younger workers and those aged 21 and over narrowed further. Only 13% expected a positive effect, while 39% said it would have no impact on their organisation. The REC warned that higher wage bills could make employers more cautious about offering entry-level roles, apprenticeships and training.

The government has asked the independent Low Pay Commission (LPC), which advises ministers on statutory minimum wage rates, to consider how and when the rate for 18-to-20-year-olds should align with the National Living Wage.

REC Survey Highlights Recruitment and Training Costs

The REC survey found that 25% of employers expected further narrowing of the pay gap to increase the cost of retaining younger workers, while 29% anticipated higher spending on training and development. A further 21% expected higher costs associated with creating entry-level roles, and 22% anticipated increased costs for offering apprenticeships.

Shazia Ejaz, the REC's director of campaigns, said the National Minimum Wage must not become a disincentive to hiring younger jobseekers. If employment costs rose too quickly, she warned, employers would 'inevitably create fewer entry-level roles, apprenticeships and training opportunities'.

The figures reflect employers' expectations; they do not establish that narrowing the wage gap has caused job losses or reduced training opportunities. The REC commissioned the survey and campaigns on employment policy.

Minimum Wage Gap Puts Equal Pay Debate in Focus

From 1 April 2026, the National Living Wage for workers aged 21 and over rose to £12.71 an hour, an increase of 50p. The minimum wage for workers aged 18 to 20 increased by 85p to £10.85 an hour, about 85% of the adult rate.

Labour's 2024 manifesto pledged to remove what it called 'discriminatory age bands', with the aim of ensuring adults receive the same statutory minimum wage regardless of age. The government has given the LPC full flexibility over the pace and timing of alignment, with priority given to younger workers' employment prospects.

TUC Argues Younger Workers Should Receive Equal Rates

The Trades Union Congress (TUC), the UK's national trade union centre, has argued that younger workers should receive the same statutory minimum wage as older adults. Its position centres on equal treatment and the living costs faced by younger workers.

In March 2024, the TUC estimated that more than 700,000 workers aged 18 to 20 could miss out on an average of £2,400 a year because of the lower minimum wage rate. The estimate was based on the rates and data available at the time, before the April 2026 increases.

The statutory minimum is not the wage every young worker receives, as some earn more than the legal floor. The TUC argues that age alone should not determine the minimum an adult can earn.

Low Pay Commission To Advise on Next Rates

The LPC's 2026 consultation sought evidence from employers, workers and other stakeholders to inform recommendations for minimum wage rates taking effect in April 2027. The consultation opened on 1 April and closed on 26 June.

The commission's remit includes assessing labour market conditions and the employment prospects of younger workers as it considers the government's commitment to align the adult and younger workers' rates. According to the government's remit, its advice is due by the end of October 2026.

The government will consider the commission's recommendations as it determines the next minimum wage rates and the pace of any further alignment.