UK new minimum wage 2027: What will the new rates be, how much more will workers earn, and when does the new minimum wage start?

UK new minimum wage: Britain's finance minister John Healey said on Wednesday that the main minimum wage rate would increase by 3.9%, reported news agency Reuters. The minimum wage for workers aged 21 and over will rise by 3.9%, from £12.71 to £13.21 an hour. The rate for workers aged 18 to 20 will also increase by 3.9%, from £10.85 to £11.27 an hour. However, 18-to-20 year-olds are set to see lower increases than in previous years, reports BBC.

Pay for younger workers will increase alongside the minimum wage for employees aged 21 and over. However, the rise is smaller than those introduced over the past two years, when Labour increased wages for younger workers as part of its manifesto pledge to end “discriminatory age bands” and move towards a single minimum wage for all adults.

"For 2.3 million ​of our lowest-paid workers, I'm increasing both the national minimum wage ⁠and the National Living Wage by 3.9%," Healey told lawmakers on Wednesday.


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How much more will UK workers earn per month?

The UK's minimum wage increase will give full-time workers aged 21 and over an extra £81 a month before tax. The hourly rate will rise from £12.71 to £13.21 in April 2027. For someone working 37.5 hours a week, this means an additional £975 a year.

Workers aged 18 to 20 will also receive a pay rise, with their hourly rate increasing from £10.85 to £11.27. Those working 37.5 hours a week could earn around £68 more per month before tax, or £819 a year. That is a smaller rise than the 26% increase the Labour government has put in place for younger workers since returning to power in 2024.

Despite the increase, the rate for younger workers will remain below that for employees aged 21 and over. The National Living Wage for older workers is currently £12.71 an hour and is set to rise by 3.9% to £13.20, The Times reported.

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Will the pay rise cover rising bills?

The increase comes as UK households continue to face higher living costs. Annual inflation rose to 3.5% in September 2026, according to the Office for National Statistics. While the 3.9% wage increase is higher than the latest inflation rate, workers may still feel pressure from rising housing, food, energy and transport costs.

Andrea Egan, general secretary of the union Unison, said it was "deeply unfair" to keep paying different rates for the same job.

"Twenty year-old care workers, teaching assistants and security guards do the same work as their older colleagues," she said. "They don't pay less in the supermarket or at the petrol pump. They must be paid equally."

In April, ​Britain's Low Pay Commission – which advises on minimum wage rates – had said the National ​Living Wage would probably need to increase by around 3.7% in 2027 to £13.18 an hour to keep up with how it expected average pay to rise.

(With inputs from Reuters)