London: The British arm of German discount supermarket Aldi has increased pay for over 28,000 hourly workers for the second time in two months, overtaking a recent rise by rival Lidl GB. From September 1, Aldi will pay £13.02 ($17.59) an hour, along with paid breaks, to ‘maintain its position as sector leader.’
Earlier this month, Lidl announced its fifth pay increase in two years, raising its entry-level hourly rate nationally to £13, with rates rising to £13.95 depending on length of service. Aldi had previously announced a £13 rate, effective September 1. Employees in London at both discounters will receive higher pay rates.
Tesco, the UK’s grocery industry leader, will offer a minimum of £12.64 per hour from September 1. The government-mandated minimum wage currently stands at £12.21 per hour. The body responsible for setting the rate has indicated it may need to rise to £12.71 next year to meet the government’s target of two-thirds of median earnings.
The Bank of England is monitoring wage settlements closely as it considers whether inflation pressures will permit further interest rate cuts. Official data released on August 12 showed that the UK jobs market weakened again, with payrolls falling for a sixth consecutive month. However, wage growth remains strong, explaining why the BoE is cautious in reducing borrowing costs.
Supermarket wages are now outpacing government minimums, driving payroll costs higher across the sector. While this could support consumer spending, tighter profit margins and inflation risks remain key challenges for retailers.
Hefty pay rises for staffs from supermarkets like Aldi or Lidl highlight ongoing labor market tightness and the impact of government-driven wage policy. With payroll employment cooling yet wage growth remaining strong, these trends are expected to influence consumer confidence and shape UK economic policy in the months ahead.
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