Business newsline by Tony Seymour

More than 8,000 jobs in the Yorkshire and Humber region are at risk over the next three years, because of the National Minimum Wage (NMW) of £3.60 an hour, which comes into force on April 1.

So warns a report from the economic consultancy, Business Strategies, launched at a conference in London today.

It argues that where employers are not already paying the new minimum, its implementation and its knock-on effects on wage differentials will force firms to reduce their profits or increase prices.

Overall, hotels, catering and the wholesale trade are se to be worst hit with the loss of 4,246 jobs. Bar staff, waiters, waitresses and low-paid kitchen staff can all expect to be affected.

Retailing will be badly hit too with 1,265 jobs set to go in the shops, stores and supermarkets.

Melanie Lansbury, managing economist with Business Strategies and author of the report, said: "Nearly two-thirds of those in the region whose jobs are at risk are women (5,273), who are more often to be found in lower-paid occupations than men." Roland Harris, chief executive of York and North Yorkshire Chamber of Commerce, said his members were "not happy" about the NMW. "The worst effects will undoubtedly be felt in the textile industries in Bradford, and parts of Humberside where the fish processing industries are prevalent. These are the areas where the requirement to increase the pay may well manifest itself in some job losses over time."

However, Ian McCartney, Trade and Industry Minister, said: "As a former low-paid worker I have campaigned most of my working life for a national minimum wage. The National Minimum Wage fulfils a key manifesto pledge and will begin to remove the scandal of low pay from the workplace. Two million low-paid workers will benefit directly from its introduction."

The Low Pay Commission (LPC) has been asked by the Government to monitor the implementation of the National Minimum Wage. Claire Durkin, LPC secretary, refutes the Business Strategies report and challenges Mr Harris's comments. "We've done quite a bit of work already in Yorkshire and Humberside to establish baselines so we can measure the impact," said Ms Durkin, "and so far the picture has been very positive indeed."

She added: "Certainly, it's true some people will be getting an increase because of the National Minimum Wage, but we see no danger at the moment of any significant job losses in the area."

Meanwhile, fast-food outlet McDonald's also supports the principle of a National Minimum Wage. A McDonald's spokesperson said: "We welcome the wide and detailed consultation that the Government made on the issue."

The National Minimum Wage will benefit almost two million people, including 183,000 workers in Yorkshire & Humber, representing 9.4 per cent of the regiona's workforce. The percentage of those aged 21 and over earning below £3.50 in the City of York, is 2.5 per cent of the working population; Vale of York: 4.2 per cent.

Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.