Last Updated – 08-10-2026
The UK minimum wage could increase to £13.18 per hour from 1 April 2027, potentially giving millions of lower-paid workers another increase in their earnings.
According to the Low Pay Commission’s indicative forecast, the National Living Wage for workers aged 21 and over could rise by approximately 3.7%, from £12.71 to £13.18 per hour.
The Commission has also published a wider projected range of £13.02 to £13.34, reflecting uncertainty surrounding wage growth, inflation and economic conditions.
However, the Government has not yet confirmed the final minimum wage rates for April 2027.
For employees, the proposed increase could provide additional financial support as household costs remain a concern. For employers, it raises important questions about payroll budgets, staffing costs and business profitability.
Here is what the latest forecasts indicate, how much workers could earn and when the official rates are expected to be announced.
How Much Will the Minimum Wage Increase in 2027?
The National Living Wage could increase by 47p per hour, bringing the statutory minimum for workers aged 21 and over to approximately £13.18 from April 2027.
This represents a projected 3.7% increase compared with the confirmed 2026 rate of £12.71.
However, this forecast applies to the National Living Wage. The Low Pay Commission has not yet confirmed its recommendations for younger workers or apprentices.
UK Minimum Wage Rates for 2026 and 2027
| Worker category | April 2026 rate | April 2027 forecast |
|---|---|---|
| Aged 21 and over | £12.71 | £13.18 projected |
| Aged 18–20 | £10.85 | Not confirmed |
| Aged 16–17 | £8.00 | Not confirmed |
| Apprentices | £8.00 | Not confirmed |
Source: Low Pay Commission. The 2026 rates are legally confirmed; the £13.18 figure is an indicative 2027 forecast.
The confirmed April 2026 pay increases provide useful context for understanding how statutory wages have changed across different age groups.
In 2026, the National Living Wage increased by 4.1%, while the minimum wage for workers aged 18–20 rose by 8.5%.
The larger percentage increase for younger employees reflected the Government’s ambition to reduce the gap between adult and youth minimum wage rates.
What Is the Predicted National Living Wage for April 2027?
The Low Pay Commission has published three indicative figures for the April 2027 National Living Wage.
| Forecast scenario | Hourly rate | Increase from 2026 |
|---|---|---|
| Lower estimate | £13.02 | 2.4% |
| Central estimate | £13.18 | 3.7% |
| Upper estimate | £13.34 | 5.0% |
The central estimate of £13.18 is based on maintaining the National Living Wage at approximately two-thirds of median hourly earnings.
This benchmark is important because the Government uses it as a reference point when assessing low pay across the UK economy.
Nevertheless, the final recommendation will not be determined by wage growth alone.
The Low Pay Commission must also consider:
- Inflation: Whether the proposed rise would protect workers’ purchasing power.
- Employment: How higher wage costs might affect recruitment and job opportunities.
- Business affordability: Whether employers can sustainably absorb higher payroll expenses.
- Economic conditions: The wider outlook for wages, productivity and business growth.
- Living costs: The impact of everyday expenses on lower-income households.
The Commission has warned that its projected figures are indicative rather than guaranteed.
Its official 2027 minimum wage forecast explains that economic developments and updated earnings data could change the final recommendation.
How Much More Could Workers Earn Under the 2027 Minimum Wage?
If the National Living Wage increases to £13.18, employees aged 21 and over who currently receive £12.71 could earn an additional 47p for every hour worked.
For full-time workers, the difference could be worth hundreds of pounds annually.
A worker completing 37.5 paid hours per week throughout the year could receive approximately £916.50 more in gross annual wages.
Expected Earnings at £13.18 Per Hour
These calculations assume 37.5 paid hours per week for 52 weeks, except for the separate eight-hour daily example.
They exclude Income Tax, National Insurance, pension contributions and other deductions.
Annual Pay Increase Based on Working Hours
| Weekly paid hours | Additional weekly pay | Additional annual pay |
|---|---|---|
| 20 hours | £9.40 | £488.80 |
| 30 hours | £14.10 | £733.20 |
| 37.5 hours | £17.63 approximately | £916.50 |
| 40 hours | £18.80 | £977.60 |
A full-time employee working 40 hours per week could therefore earn approximately £977.60 more annually if the central forecast becomes the legal rate.
Importantly, these figures show gross earnings rather than the increase workers would receive in their bank accounts.
Actual take-home pay depends on individual circumstances, including taxation, workplace pension arrangements and any benefits affected by earnings.
When Will the Government Announce the Minimum Wage Increase for 2027?
The Government has instructed the Low Pay Commission to submit its recommendations for the 2027 minimum wage rates by the end of October 2026.
Once the recommendations have been considered, ministers will confirm the final statutory rates.
The expected timetable is:
| Stage | Expected timing |
|---|---|
| Low Pay Commission consultation | Completed June 2026 |
| Commission’s final recommendations | By the end of October 2026 |
| Government announcement | After recommendations are considered |
| New minimum wage rates take effect | 1 April 2027 |
The final government announcement date has not been confirmed.
Historically, minimum wage decisions have often been announced during the autumn, giving businesses time to prepare for the following April.
The new rates are intended to take effect from 1 April 2027. However, an employee’s entitlement to the revised rate begins with the first pay reference period starting on or after the change.
For example, if a monthly pay reference period runs from the 16th to the 15th, the new rate may first apply from 16 April rather than 1 April.
This is an important distinction for employees checking their April and May payslips.
Will the Minimum Wage Increase for 18–20-Year-Olds in 2027?
Workers aged between 18 and 20 could receive another minimum wage increase in April 2027, although the amount has not yet been announced.
The current minimum wage for this age group is £10.85 per hour.
The Government has committed to eventually aligning the 18–20 minimum wage with the National Living Wage paid to older adults.
However, the Low Pay Commission has been given flexibility over how quickly this alignment should happen.
One possibility previously outlined by the Commission was to extend National Living Wage eligibility to 20-year-olds in 2027, followed by 18- and 19-year-olds in later years.
This remains a possible pathway rather than a confirmed policy decision.
The Commission must assess whether accelerating wage increases for younger workers could affect recruitment, training opportunities and employment.
For businesses employing large numbers of younger staff, particularly in retail, restaurants and hospitality, such changes could have significant financial implications.
Will Apprentices Receive a Minimum Wage Increase in 2027?
Apprentices may also receive higher minimum pay from April 2027, but no official rate has been confirmed.
The current apprentice minimum wage is £8.00 per hour.
The apprentice rate applies to workers who are:
- Under 19 and undertaking an apprenticeship.
- Aged 19 or over and in the first year of their apprenticeship.
Apprentices aged 19 or over who have completed their first apprenticeship year must receive at least the minimum wage applicable to their age.
For example, a 21-year-old apprentice who has completed their first year must currently receive at least £12.71 per hour, rather than the £8.00 apprentice rate.
Any changes to the 2027 apprentice wage will depend on the Commission’s recommendations and the Government’s final decision.
Why Could the Minimum Wage Increase Again in 2027?
Several economic and policy considerations are influencing the projected increase.
1. Protecting Workers Against Living Costs
The Government has made improving living standards a priority when reviewing statutory wages.
Higher pay could help lower-income households manage essential spending, including food, transport, housing and energy.
However, an increase in hourly pay does not automatically guarantee an improvement in purchasing power.
If consumer prices rise more quickly than wages, the real financial benefit may be reduced.
2. Maintaining the Low-Pay Benchmark
The National Living Wage is linked to the policy benchmark of approximately two-thirds of median hourly earnings.
As typical earnings across the economy increase, the statutory minimum may also need to rise to maintain that relationship.
This is one reason the Low Pay Commission’s central forecast currently points towards £13.18.
3. Supporting Lower-Paid Workers
National minimum wage increases are particularly important in sectors employing significant numbers of hourly-paid workers.
These include hospitality, retail, cleaning, social care, food services and parts of the leisure industry.
The statutory rate provides a legal wage floor, although employers are free to offer higher hourly rates.
4. Balancing Pay Growth With Business Costs
Increasing the minimum wage also raises employers’ payroll commitments.
For businesses with narrow profit margins, a rise in hourly rates can create additional pressure on operating budgets.
The challenge for policymakers is to improve earnings while limiting unintended consequences for employment and business investment.
What Have Experts Said About Future Minimum Wage Increases?
Baroness Philippa Stroud, Chair of the Low Pay Commission, has emphasised the importance of balancing workers’ earnings with wider economic conditions.
Commenting on the April 2026 increase, she said the Commission had sought to:
“balance the need to protect the economy and labour market”
She also emphasised the importance of achieving higher real-terms earnings for the lowest-paid workers.
Her comments highlight the competing considerations involved in determining the 2027 rates.
The Commission’s approach is based on evidence from employers, trade unions, labour-market specialists and other stakeholders.
Our analysis of the published projections suggests that £13.18 should be treated as a central planning assumption, not an approved rate or a guaranteed outcome.
The final decision could differ depending on the evidence available when the Commission completes its recommendations.
How Could the 2027 Minimum Wage Increase Affect UK Businesses?
A higher National Living Wage would affect businesses differently depending on their workforce, existing salary structure and financial position.
Companies employing large numbers of staff at or close to the statutory minimum could experience the greatest direct increase in wage costs.
Higher Payroll Expenditure
Consider a business employing 20 full-time workers aged 21 or over, each working 37.5 paid hours per week at the National Living Wage.
If the hourly rate increases from £12.71 to £13.18, the additional direct annual wage expenditure would be approximately:
20 employees × 37.5 hours × 52 weeks × £0.47 = £18,330
This calculation excludes any extra employer pension contributions, National Insurance costs or related adjustments.
For a small business, an additional annual wage commitment of this size may influence pricing, staffing decisions and operating margins.
Pressure on Existing Salary Structures
Employers may also need to review wages for staff already earning slightly above the statutory minimum.
For example, experienced employees receiving £13.20 per hour in 2026 would be earning only 2p more than the projected £13.18 rate in 2027.
Although there is not necessarily a legal obligation to preserve existing pay differences between roles, employers may increase salaries to maintain internal wage progression.
Recruitment and Staff Retention
Higher wages can improve the attractiveness of roles that have traditionally experienced recruitment difficulties.
Retail employers provide examples of businesses already paying above statutory minimum rates.
The Aldi pay rise in 2026 demonstrates how supermarkets have used pay increases to compete for staff, while the Costa Coffee pay increase illustrates wage competition within the hospitality sector.
These developments suggest some employers may consider increasing pay beyond the statutory minimum to remain competitive.
Which Workers Could Benefit Most From the 2027 Pay Rise?
The proposed increase would directly benefit eligible workers whose hourly earnings would otherwise fall below the new statutory rate.
The impact is likely to be particularly relevant in several sectors.
| Employment sector | Potential effect |
|---|---|
| Retail | Higher minimum pay for eligible shop-floor and warehouse employees |
| Hospitality | Increased wages for eligible bar, restaurant and hotel staff |
| Social care | Higher statutory wage floor for lower-paid care workers |
| Cleaning | Higher hourly pay for eligible cleaners and support staff |
| Leisure | Increased minimum pay for eligible frontline employees |
| Food services | Higher statutory wages for eligible food preparation and service workers |
Care workers are an important group because of the number of employees receiving wages close to the legal minimum.
Our coverage of care worker pay increases also examines separate government plans for improving pay and employment conditions across adult social care.
However, not everyone in these industries would automatically receive a 3.7% salary increase.
Employees already earning more than the final 2027 statutory rate would not necessarily be entitled to an additional rise simply because the National Living Wage increases.
Will the 2027 Minimum Wage Increase Affect Universal Credit?
An increase in minimum wage earnings could affect the Universal Credit payments received by some working households.
Universal Credit is means-tested, meaning higher employment income can reduce the amount of support paid.
For claimants subject to the standard earnings taper, Universal Credit generally reduces by 55p for every additional £1 of earnings counted for the taper, after any applicable work allowance.
As a result, an increase in gross wages does not necessarily produce the same increase in total household disposable income.
The final impact depends on circumstances such as household earnings, tax deductions, housing support and whether a work allowance applies.
This does not mean higher wages eliminate the financial benefit of working. It means workers receiving means-tested benefits should consider their earnings and benefit payments together when estimating the effect of a pay rise.
What Should Employers Do Before April 2027?
Businesses do not need to implement the projected £13.18 rate while it remains unconfirmed.
However, employers can begin preparing budgets and reviewing payroll arrangements.
Important considerations include:
- Budget forecasting: Model staffing costs using the lower, central and upper wage projections.
- Payroll systems: Prepare to update hourly rates once the Government confirms the figures.
- Employee age bands: Check workers’ dates of birth and apprentice eligibility.
- Salary structures: Consider whether changes could affect wages for more experienced employees.
- Employment contracts: Review working hours, deductions and applicable pay arrangements.
- Minimum wage compliance: Ensure required working time is properly recorded and paid.
Employers should also review deductions for uniforms and other compulsory work-related expenses.
Such costs can reduce pay for minimum wage compliance purposes, potentially creating an underpayment even when an employee’s stated hourly rate appears sufficient.
Is the National Living Wage Different From the Real Living Wage?
Yes. The National Living Wage and the voluntary real Living Wage are separate wage standards.
The National Living Wage is the statutory minimum hourly rate for workers aged 21 and over.
The real Living Wage, calculated by the Living Wage Foundation, is a voluntary benchmark based on living costs. It includes a separate higher London rate.
Employers can choose to adopt the voluntary benchmark, but it is not the legal minimum wage.
Consequently, an announced increase in the real Living Wage should not be confused with the Government’s annual statutory minimum wage decision.
Final Outlook: Could the Minimum Wage Reach £13.18 in 2027?
The current Low Pay Commission forecast indicates that the UK’s National Living Wage could rise from £12.71 to approximately £13.18 per hour in April 2027.
For an employee aged 21 or over working 37.5 hours per week, this would mean a gross annual income of approximately £25,701, representing an increase of £916.50 compared with the existing minimum wage.
However, the actual figure remains uncertain.
The Commission must consider wage growth, inflation, business costs and employment conditions before submitting its final recommendations by the end of October 2026.
Until the Government announces the approved rates, £13.18 should be treated as a forecast rather than the confirmed UK minimum wage for 2027.
Frequently Asked Questions
What will the UK minimum wage be in 2027?
The National Living Wage for workers aged 21 and over is projected to reach £13.18 per hour, but the Government has not confirmed the final 2027 rate.
Is the minimum wage going up in April 2027?
New statutory minimum wage rates are intended to take effect from 1 April 2027. The exact increases have not yet been announced.
What percentage will the minimum wage increase by in 2027?
The Low Pay Commission’s central forecast suggests an increase of approximately 3.7%, although its indicative range is between 2.4% and 5.0%.
How much is £13.18 per hour annually?
At 37.5 paid hours per week for 52 weeks, £13.18 per hour equals approximately £25,701 annually before deductions.
Will 18-year-olds receive £13.18 per hour in 2027?
Not necessarily. The Government intends to align adult minimum wage bands over time, but extending the National Living Wage to 18-year-olds in April 2027 has not been confirmed.
Does the minimum wage increase apply across the whole UK?
Yes. The statutory National Minimum Wage and National Living Wage apply across England, Scotland, Wales and Northern Ireland.
When will workers receive the higher minimum wage?
The revised rate is expected to apply from the first pay reference period beginning on or after 1 April 2027, once the Government has confirmed the new rates.
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