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Raising the minimum wage to £10 an hour would help to ease the longest squeeze on incomes since the Napoleonic era for 9m workers, research shows.

Labour is already committed to a £10 minimum wage by 2020 and the latest research for the Unite union found that the rise for workers aged 18-plus would boost public coffers by £5.6 billion a year.

Workers in hospitality and retail, where low pay is rife, would be the biggest winners from the increase, according to the research conducted by an economic think-tank.

A £10 minimum wage would boost net income by more than £1,300 a year and would benefit 5.2m female workers and three out of four young workers aged 18 to 20.

An ‘intermediate’ increase to £9 an hour for workers aged 25 and over, £8.70 for those aged 21-24 and £8 for 18-20-year-olds would benefit 6.25m workers. The current full National Minimum Wage rate is £7.83 per hour for workers aged 25 and over.

(Image: REX/Shutterstock)

The research comes ahead of today’s speech by Labour’s shadow chancellor John McDonnell at Unite’s policy conference in Brighton.

poll loading Should the minimum wage rise to £10? 500+ VOTES SO FAR Yes No

Steve Turner, Unite assistant general secretary, said: “Workers’ wallets are running on empty and incomes are being squeezed by cuts to in-work benefits and the government’s chaotic introduction of Universal Credit.

“There is something desperately wrong with our economy when 60 per cent of people in poverty are living in working households and over one million food parcels are handed out each year.

“As in-work poverty grows, big business is benefitting from corporate welfare which is subsidising low pay across the economy in the form of in-work benefits.

“Increasing the minimum wage and national living wage to £10 per hour would be a huge boost for young workers and help end poverty pay rates that hospitality workers have to endure.

“It would be a virtuous circle helping ease the squeeze on incomes, while increasing the public finances through greater tax revenues and reduced spending on in-work benefits.

“A £10 per hour minimum wage would mean extra money in people’s pockets which would be spent in communities and on high streets across the UK. It would help breathe life into a flagging economy and make work pay.”

(Image: PA)

Meanwhile, an analysis of official figures by the GMB union has found that more than 500,000 young people in the UK suffer wage discrimination as they are paid less just because of their age.

The union is backing a Private Members Bill calling for age banding in the National Minimum Wage to be scrapped, which is set to be debated by MPs in the House of Commons this Friday (6 July)

Under current minimum pay banding employers are able to pay £7.38 per hour to workers who are aged between 21 and 24, and only £5.90 per hour for those who are aged 18 or over but not yet aged 21.

Alice Pitchford, GMB Young Member, said:“It’s hard to describe how frustrating it is being paid less money than someone doing the same job as you just because of your age.

“It doesn’t matter how hard you work or how much effort you put in, you are simply not ‘worth’ as much. It makes you feel undervalued.

“I’m not asking for much, simply to be paid the same wage as my colleagues for doing the same job.

“It’s not like I get discounted bills or rent, so why should I be employed at a discounted rate of pay.”