Marks & Spencer gives store workers 5% pay rise

British clothing and food group Marks & Spencer said its 50,000 retail workers will get a 5% pay rise from April 1, an investment of 95 million pounds ($122 million).

Marks & Spencer said on Wednesday the pay for UK customer assistants will increase to at least 12.60 pounds an hour, with workers in London paid 13.85 pounds an hour.

The new rates come ahead of the UK government’s 6.7% hike in the national minimum wage to 12.21 pounds for most adults that will kick in from next month.

They will be noted by the Bank of England, which is keeping a close eye on wage settlements as it assesses further moves in interest rates after cutting by a quarter-point last month.

British pay growth accelerated in late 2024, according to official data published last month that suggested the jobs market was holding up and underscored why the Bank of England has been cautious about cutting interest rates despite a weak overall economy.

“Following the government’s recent increases in tax and national insurance contributions, it’s no secret that M&S and indeed the entire retail sector has some significant cost headwinds to face in the new financial year,” Marks & Spencer CEO Stuart Machin said.

“However, I have always believed that we should not allow these headwinds to impact our hourly paid colleagues.”

Several retailers, including Sainsbury’s and Costa Coffee, have also recently announced above inflation pay rises.

UK inflation hit a 10-month high of 3% in January, according to official data.