UK Politics

[steviewevie]

23 minutes ago, lazyred said:

Next April it is minimum wage rises plus employers NI changes plus reducing small Business Rates relief. It is a lot to absorb in one go.

yes, but all that lovely investment in public services and clean energy.

[steviewevie]

ok...makes sense now...

 

[steviewevie]

3 hours ago, lost said:

 

Intersting post after the last one as the exponential rise is due to the industrial revolution / fossil fuels. Cheap energy is inextricably linked to growth, life expectancy and the removal of child labour and slavery from society.

also...empire (and slavery) helped with that too...nice bit of globalisation/exploitation.

[Alvoram]

3 hours ago, steviewevie said:

people have talked about min wage leading to higher umemployement since early 2000s...and yet...

I'm not saying it will lead to higher unemployment overall, read it again. 

I'm saying that if they continue to close the minimum wage gap between an experienced 21+ year old, and an inexperienced 16 - 20 year old, then why would you go for somebody inexperienced? It's young people that minimum wage rises will affect, in that it will mean they have to compete more for low skilled jobs, that much is obvious, is it not? 

In regards to the overall minimum wage rise, that's only going to hit point of sale prices. It will lead to job losses, but probably not enough to affect overall figures. Ultimately it will depend on how much the consumer is willing to swallow the price increases and keep spending.

[steviewevie]

1 minute ago, Alvoram said:

I'm not saying it will lead to higher unemployment overall, read it again. 

I'm saying that if they continue to close the minimum wage gap between an experienced 21+ year old, and an inexperienced 16 - 20 year old, then why would you go for somebody inexperienced? It's young people that minimum wage rises will affect, in that it will mean they have to compete more for low skilled jobs, that much is obvious, is it not? 
 

because of employee flexibility? because of demand for those sort of jobs? 

Anyway, we'll see. 

I bet you £10000000000000 that there will be a negligible rise if any in young person unemployment because of this measure.

[Alvoram]

6 minutes ago, steviewevie said:

because of employee flexibility? because of demand for those sort of jobs? 

Anyway, we'll see. 

I bet you £10000000000000 that there will be a negligible rise if any in young person unemployment because of this measure.

I'll put you a tenner on it. But you need to define negligible, especially since I was specifically stating this as an 'if they continue to close the gap!' At the moment there's still a £2 difference, which is 'probably' enough of an incentive to give inexperienced youngsters an opportunity. 

But yeh, I'll still put a tenner on it, if youth unemployment goes up at all next year, you donate a tenner to my chosen charity, and if it doesn't or it drops, I'll donate to yours. 🙂 That's a bet I'll take, as I do think overall unemployment figures will rise, and thus, so will youth unemployment. 

Edited: Changed it to a tenner... Feeling flush haha

Edited 3 hours ago by Alvoram

[steviewevie]

1 minute ago, Alvoram said:

I'll put you a tenner on it. But you need to define negligible, especially since I was specifically stating this as an 'if they continue to close the gap!' At the moment there's still a £2 difference, which is 'probably' enough of an incentive to give inexperienced youngsters an opportunity. 

But yeh, I'll still put a tenner on it, if youth unemployment goes up at all next year, you donate a tenner to my chosen charity, and if it doesn't or it drops, I'll donate to yours. 🙂 That's a bet I'll take, as I do think overall unemployment figures will rise, and thus, so will youth unemployment. 

Ok yeah whatever a tenner..if that helps...

[steviewevie]

Anyone want a bet on GDP in 2035?

Or average NHS waiting times in 2028?

Or whether anything exists in 3094?

Edited 3 hours ago by steviewevie

[steviewevie]

3 minutes ago, steviewevie said:

Ok yeah whatever a tenner..if that helps...

I won't pay it by the way...lost numerous bets on here and never paid a penny.

[lost]

22 minutes ago, steviewevie said:

also...empire (and slavery) helped with that too...nice bit of globalisation/exploitation.

 

UK abolished the slave trade in 1807 and passed the factory act in 1833. Both a product of the industrial revolution. One barrel of oil has the same amount of energy of up to 25,000 hours of hard human labour (12.5 years of work)

Edited 3 hours ago by lost

[Crazyfool01]

dont believe youngsters should be paid any less in my industry ( retail ) .... its numbers we need and paying youngsters a bit more would be a good way of encouraging them and potentially retaining them longer . you really dont need to be skilled 

[steviewevie]

4 minutes ago, Crazyfool01 said:

dont believe youngsters should be paid any less in my industry ( retail ) .... its numbers we need and paying youngsters a bit more would be a good way of encouraging them and potentially retaining them longer . you really dont need to be skilled 

yeah but it's cheap labour.

[Alvoram]

1 hour ago, Crazyfool01 said:

dont believe youngsters should be paid any less in my industry ( retail ) .... its numbers we need and paying youngsters a bit more would be a good way of encouraging them and potentially retaining them longer . you really dont need to be skilled 

 

So you think somebody with experience should be paid the same as somebody with no experience, fresh out of school? 

 

Edited 2 hours ago by Alvoram

[Alvoram]

1 hour ago, steviewevie said:

yeah but it's cheap labour.

That exactly what keeps your pints below a fiver, your Maccies below a tenner and your milk below £2.

You can't have your cake and eat it. I'd love to be able to pay everybody much more, but it only has a knock on effect at the till. And are you happy to pay much more for your goods? 

[Crazyfool01]

1 minute ago, Alvoram said:

 

So you think somebody with experience should be paid the same as somebody with no experience, fresh out of school? 

Yep in this case because experience doesn’t really mean you can do a fairly basic job any better , and that’s from me that’s done the job for 30 years …. Up a level then experience I’d say does start to count for something but a supervisory role gets paid a higher rate anyway 

[Alvoram]

7 minutes ago, Crazyfool01 said:

Yep in this case because experience doesn’t really mean you can do a fairly basic job any better , and that’s from me that’s done the job for 30 years …. Up a level then experience I’d say does start to count for something but a supervisory role gets paid a higher rate anyway 

If they're doing exactly the same job, and no skill whatsoever is involved, then fair enough. 

But Should I pay an 18 year old, who has never pulled a pint the same as I pay a 25 year old, who can not only pull pints (doesn't require skill) but also change gas, rack ales, condition them, tap them, mix cocktails, has barista experience etc etc. (The things that DO require some skill and experience.) 

I have to invest time and money in that person, who will probably move on after university. Whereas I can now get an experienced person for a similar price.

 

Edited 2 hours ago by Alvoram

[Crazyfool01]

1 minute ago, Alvoram said:

If they're doing exactly the same job, and no skill whatsoever is involved, then fair enough. 

But Should I pay an 18 year old, who has never pulled a pint the same as I pay a 25 year old, who can not only pull pints (doesn't require skill) but also change gas, rack ales, condition them, tap them, mix cocktails, has barista experience etc etc. (The things that DO require some skill and experience.) 

Depends how long it takes them to gain those skills I’d guess …. Does it take 7 years ? Or does pay go up as they gain a skill ? Or does it take 2 years ? I do understand that costs are astronomical for business at the moment but maybe some of the other things that impact are more an issue . The U.K. pay and living standards are low and falling 

[steviewevie]

27 minutes ago, Alvoram said:

That exactly what keeps your pints below a fiver, your Maccies below a tenner and your milk below £2.

You can't have your cake and eat it. I'd love to be able to pay everybody much more, but it only has a knock on effect at the till. And are you happy to pay much more for your goods? 

Pints below a fiver?

[Alvoram]

5 minutes ago, steviewevie said:

Pints below a fiver?

I live in Derbyshire 🙈🤣 £4.40 for our core (Amstel) lager.
 

23 minutes ago, Crazyfool01 said:

Depends how long it takes them to gain those skills I’d guess …. Does it take 7 years ? Or does pay go up as they gain a skill ? Or does it take 2 years ? I do understand that costs are astronomical for business at the moment but maybe some of the other things that impact are more an issue . The U.K. pay and living standards are low and falling 

We do increase pay as staff members become more experienced, we also pay a little above minimum to begin with. Or at least we traditionally have done, we may have to change that in the future, but I digress. Lots of places aren't in a position to, they pay minimum wage and that's that, it's how they keep their prices competitive. 

Either way, if that gap between youngsters and experienced adults gets much closer, I absolutely will be looking more at experienced members of staff for roles I'd have been hiring youngsters for. You see, it works both ways, youngsters take these jobs as stop gaps, for a bit of extra money whilst they're still in uni or living with parents. We know they're not sticking around, and they know it too, it's not a career choice. It's still worth investing that time and money into training them, if only for a year or two before they move onto their actual chosen career path, because they cost less in wages. With no pay gap, why invest time and money training somebody who will be gone in a year or two? 

I absolutely, 100% agree with your final comment. I think we still have some way to go even after April. But the point I'm making is that people have to know this will mean higher prices at the tills, the money has to come from somewhere.

With a turnover of 500k, we lost 30k last year, there's no way we're swallowing these additional payroll expenses, the customer will be, and then some, sadly. At what price point will people just stop coming to the pub? It's a massive concern. 😞  

 

Edited 1 hour ago by Alvoram

[mattiloy]

6 hours ago, Alvoram said:

There's up to an 18% increase in minimum wage too, on top of any tax and NI changes. This affects not only our own wage bill massively, (since hospitality primarily employs young people, we'll be hit hard by the 16.3% increased 18-20 year old category) but also our suppliers too. Even if you pay just above minimum to youngsters, as we do, their wages must still go up accordingly. 

The wage increase will hit hospitality and retail hard, most people in these industries are paid at or just above minimum wage. So prices there will go up sharply at the end of winter, without a shadow of a doubt. 

If you thought 20-50p on a pint was bad last year, just wait. We have no choice, increase and see a drop in footfall, or stick and see annual losses even higher than last year's losses. Either way it will lead to job losses. And I need to keep a roof over our head, so I'd rather be a quieter pub, with less staff, but breaking even, than busy fools, with lots of staff, but losing money. If that's even going to be possible! Wages are always going to be our biggest cost, so they'll always be the first expense to cut into.  

I also think this balancing of the minimum wage categories, as in, bringing up the minimum wage of youngsters at a much higher rate than adults, is a bad idea all around. In hospitality and retail, (and probably other low skilled sectors too,) adults are also paid at or close to minimum wage more often than not too. If youngsters are near enough the same cost to a business, why employ so many? Put a youngster with no experience, no track record of reliability up against a more experienced, proven reliable, job candidate, without the difference in cost to the business, and who do you think will win the job? Rightly or wrongly, cost to the business is a factor when making hires, so traditionally, that has given youngsters the edge in low skilled sectors. Mark my words, this IS going to lead to higher youth unemployment. 

Sorry mattiloy, I quoted you then went off on a completely different rant... 🙈🤣

 

 

Interesting to hear from the other side.

 

But even given the above the required increase in your prices of an increase of 16% on the wages of your most junior staff would be a fraction of that increase. Because of even in hospitality labour costs are usually not much more than 50% of the total cost of doing business.
 

And sure then maybe your suppliers employ one or two 18-20 year olds but I’d guess that they represent a minority of employees of a brewery for example and again, a fraction of their total costs. 
 

But sure maybe in some sectors that pay staff less than a living wage then in order to break even they’ll put prices up by some single digit %. But you know what? A lot of the patrons of those very same pubs will suddenly have 16% more to spend on pints, so it’s all fine.

 

Which is in the end what this is all about- the economic pain of the financial crisis in 2008 was borne disproportionately by the working man. The decline in real disposable incomes (after adjusting for housing costs) amongst lower income groups is the real threat to traditional pubs because these people constitute the clientele of traditional pubs. So lets raise their disposable income, and let them raise a glass at your gaff and dispose of that new disposable income in your urinals, and be glad that the Tory’s relentless assault on the spirit of working man is at an end 😁

 

Edited 1 hour ago by mattiloy

[Alvoram]

59 minutes ago, mattiloy said:

 

 

Interesting to hear from the other side.

 

But even given the above the required increase in your prices of an increase of 16% on the wages of your most junior staff would be a fraction of that increase. Because of even in hospitality labour costs are usually not much more than 50% of the total cost of doing business.
 

And sure then maybe your suppliers employ one or two 18-20 year olds but I’d guess that they represent a minority of employees of a brewery for example and again, a fraction of their total costs. 
 

But sure maybe in some sectors that pay staff less than a living wage then in order to break even they’ll put prices up by some single digit %. But you know what? A lot of the patrons of those very same pubs will suddenly have 16% more to spend on pints, so it’s all fine.

 

Which is in the end what this is all about- the economic pain of the financial crisis in 2008 was borne disproportionately by the working man. The decline in real disposable incomes (after adjusting for housing costs) amongst lower income groups is the real threat to traditional pubs because these people constitute the clientele of traditional pubs. So lets their disposable income, and let them dispose of it in your urinals, and be glad that the Tory’s relentless assault on the spirit of working man is at an end 😁

 

Honestly, our wage budget 'should' be around 24% of turnover, that's the number we aim for. But in recent years it's been just above 30%. We need to get that back down somehow. But that's a whole different subject, and a unique problem for us (and probably other pubs since the last big increase in MW.) 

We're expecting a total increase in wage expenses, with pay rises, and NI changes, to be around 19-20%. You're right, in that this will probably only account for a 6% increase in total costs. 

We also have a 1% increase in business rates to contend with.

And then our cost of goods will increase, as our suppliers bump their prices up. Trying to guess by how much is ridiculous, because we have no idea of the impact things will have on our suppliers. But the major breweries tend to increase prices once or twice a year without fail anyway. I think the minimum wage increases will hit the food trade more than breweries. The food supply chain is full of staff on minimum wage at several points along the chain. Breweries, I think, tend to pay more to their staff anyway, even warehouse staff etc. 

With these 'big 3' increases next year, I expect them to account for around an 8 - 10% increase in our own prices. 

But on top of these, and we're not unique here, speaking to other pub landlords, we have to start clawing back some of the losses suffered over the past couple of years. £30k losses in a year is not sustainable. We, and many other pubs, did not pass on the full extent of our cost increases over the last couple of years. We couldn't, we may as well have shut the doors if we'd tried to pass it all on. Pints went up by up to 50p in one hit at one point already, that was just down to the brewery increases, imagine if we'd added all of our own cost increases onto that too. This has now led to these crazy losses on our accounts. It's fine for a year or two, provided we can fund the losses (not taking most of our own salaries in our case.) But we have to make money or at least break even, our salaries included, at some point. As we couldn't survive on a quarter of minimum wage ourselves for many years!!! (No, you didn't read that wrong!) So we also have to start adding the rest of the previous cost increases on. 

All told, I think we'll be adding a minimum of 10% on to all prices, possibly as much as 20%, but most likely somewhere in the middle. The good news is people will be expecting it, as the media has been full of stories like ours. 

(Also, obviously, I'm no accountant, we'll be seeking professional guidance from our accountants before April, as there's so much on the line this time around. Hence I'm not willing to commit to an actual figure, other than the admittedly vague 10 - 20%, until we've had those meetings with the accountant.)  

 

Edited 26 minutes ago by Alvoram