The NHBF urges a slowdown on minimum wage rises

An NHBF survey carried out in June 2017 revealed that trading conditions are worsening in 2017 with more salons reporting that turnover is failing to grow than in the previous two years.  Four out of five employers said the National Living Wage has increased wage bills, the biggest single cost for hairdressing, barbering and beauty businesses. 

The current National Living Wage impact

At present, business owners are taking the hit and absorbing the costs, although many have also raised prices.  But if the rate goes up as expected to around £7.85 per hour, they will have no option but to raise prices further, reduce hours worked by staff or reduce plans for investing in or expanding the business. 

Brexit does not yet appear to have had a direct impact on trading conditions, but any downturn in consumer confidence or a dip in the economy will make raising prices even more difficult if clients are forced to cut back on spending.  Salon and barbershop owners are therefore nervous about raising prices in an uncertain trading climate for fear of losing clients to cheaper competitors. 

Rising wage costs cannot be taken in isolation, as salon and barbershop owners are also hit with the additional costs of pensions auto-enrolment, new compulsory contributions to apprenticeship training and steep rises to business rates in some areas. 

The NHBF's position 

Chief executive of the NHBF, Hilary Hall, added: ‘We strongly believe that team members should be rewarded with a fair wage – they are the lifeblood of all hair and beauty businesses.  We are seeing a continuing trend where employers who can afford to do so are paying well above the minimum wage, especially for qualified and experienced staff.  But if the big rises currently projected are too fast and too frequent, many salons will struggle to continue providing employment in the current climate.  The NHBF is therefore urging the Low Pay Commission to recommend wage increases which are more in line with the rate of inflation.’