NLW to ‘cost hospitality industry £372m’: Labour scheduling software provider Catton Hospitality has calculated the cost of the new National Living Wage (NLW) on the hospitality industry as £372m. Using its labour scheduling system, S4Labour, Catton said the average cost per site would be £3,000 when the new rate for those aged over 25 comes into effect on Friday, 1 April along with increases for those aged under 25, revealed today (14 March), will come into effect on 1 October. Catton described the £3,000 figure as a “conservative estimate”, which doesn’t include maintaining any differentials currently in place, nor does it consider those operators that have committed to offering the NLW to their entire workforce. The company said operators needed to plan ahead to maintain margins, with some passing on cost to customers by raising prices. However, Catton said others would look internally to see what changes could be made. It added one area that had been highlighted was training, which it saw as the best way to improve business performance over the long term. Alastair Scott, chief executive of Catton Hospitality, said: “Over the last five years I have spoken to over a thousand operators who know that their best trained staff can deliver better service, drive spend, and ultimately improve the business. As the cost of staff rises and it is increasingly hard to find good quality people, the drive for all industries should be to improve productivity and efficiency and try to pay as much as they can afford to attract and retain the best staff. Good people like to be busy but not stressed, which is why a focus on productivity is so important.” Meanwhile, the British Beer & Pub Association has warned the new increases announced today for those aged under 25, which take effect from October, will again hit the industry. Secretary of state for business, innovation and skills Sajid Javid revealed the new rates in a written letter to Parliament. The government plans to increase the rate for 21 to 24-year-olds from £6.70 to £6.95 as recommended in the Low Pay Commission’s 2016 report. Other commission recommendations set to be implemented by the government include increasing the youth development rate, which covers 18 to 20-year-olds, from £5.30 to £5.55, while the rate for 16 to 17-year-olds should rise from £3.87 to £4. It also recommends the apprentice rate should increase from £3.30 to £3.40. Brigid Simmonds, BBPA chief executive, said: “Given the introduction of the National Living Wage in April for those over 25, and following our discussions with the Low Pay Commission, increases were anticipated. They are above inflation, but not the seven per cent increase seen for those over 25. However, the increases will have an effect on the cost of employment for pubs, the majority of which are small businesses, so we need the government to retain a clear focus on tax cuts, in particular beer duty, but also business rates, and a look at VAT in the hospitality sector.”