United Kingdom: The minimum wage could approach the starting incomes of graduates, which could discourage young people from investing in education.

The minimum wage in the United Kingdom risks approaching the starting salaries of graduates in fields such as accounting and financial services, which raises concerns among major companies in the City. The Chancellor of the Exchequer, Rachel Reeves, will announce a 4% increase in the minimum wage, reaching £12.70 per hour, which would raise the annual income of a minimum wage employee. In comparison, starting salaries for graduates in the financial sector are around £25,726, with an average of £33,000.

Executives warn that if the minimum wage aligns with entry-level salaries, young people may view higher education as a non-profitable investment, considering the high debts for education. This could affect social mobility and could lead to pressure on employers to raise wages, which could accelerate automation and outsourcing of services, thereby reducing job opportunities for young people.