April 2027 wages get set on 28 October. The Low Pay Commission already published its number

Your biggest cost line for next year already has a number attached to it, and almost nobody has looked it up. The Low Pay Commission thinks the National Living Wage will need to be around £13.18 an hour in April 2027, up from £12.71 now. On one full-time person that is roughly £1,080 a year off your profit, before you serve a single extra client. You get seven months of warning, which is more than any other cost gives you.

The number, and the date it gets confirmed

The National Living Wage is the legal minimum for anyone aged 21 and over. It is £12.71 an hour right now, and it has been since 1 April 2026.

For April 2027 the Low Pay Commission, the independent body that recommends the rates, has published its own arithmetic. In its consultation letter of 1 April 2026 it says a rate "between £13.02 and £13.34 (or an increase of between 2.4 and 5.0 per cent) would be required in April 2027, with a central estimate of £13.18 (3.7 per cent)".

So the planning number is £13.18 an hour, or 47p more than you pay today. The realistic spread is 31p to 63p.

That is not the final answer. The Commission recommends, the government decides, and neither has happened yet. But this is not a guess off a news site either. It is the body that sets the rate, showing its working, against a remit the government published on 16 March 2026 that keeps two-thirds of median earnings as the reference point.

The date it becomes real is Wednesday 28 October 2026, confirmed by the Chancellor on 31 July. Last year's rates were published on 26 November 2025, which was Budget day, so expect the same pattern.

What 47p an hour does to your wage bill

Take one full-time person, 37.5 hours a week, 52 weeks. That is 1,950 paid hours a year.

• At £12.71: £24,784 in wages.
• At £13.18: £25,701 in wages.
• The gap: £917.

But wages are not what an employee costs you. For someone aged 22 or over who is already earning above the thresholds, every extra £1 of pay brings two passengers with it:

• Employer National Insurance at 15%. You pay it on earnings above the secondary threshold, which is £5,000 a year in 2026 to 2027.
• Pension at 3%. That is the statutory minimum employer contribution, calculated on earnings between £6,240 and £50,270.

Add those and every extra £1 of pay costs you about £1.18. So the £917 becomes roughly £1,081 a year, per person.

Three stylists on the floor at that level and you are looking for about £3,240 of extra profit. At a 10% net margin that is £32,400 of extra sales just to end up where you started. Run it on your own numbers with the break-even calculator.

One honest caveat: the £5,000 and £6,240 thresholds are 2026 to 2027 figures. The 2027 to 2028 ones are not published yet, so I have held them still rather than invent them.

The part nobody puts on a rota: your costs move on birthdays

Here is the thing that does not show up in any minimum wage headline, and it matters far more in a salon than the annual rise does.

Your cost per hour for the same person, doing the same job, at the same skill, steps up twice on dates that have nothing to do with performance. Using today's rates:

A 20 year old. The 18 to 20 rate is £10.85. Employer National Insurance for under 21s is 0% on everything up to £50,270. Automatic pension enrolment does not start until 22. True cost: £10.85 an hour.

A 21 year old. The rate jumps to the full £12.71. The National Insurance exemption disappears on the 21st birthday, so you start paying 15% above £5,000. On 1,950 hours that is £2,968 of employer NI on top of £24,784 of wages. True cost: £14.23 an hour.

A 22 year old. Nothing changes on the wage rate, but automatic enrolment now applies, so add 3% on qualifying earnings, about £556. True cost: £14.52 an hour.

From 20 to 21 is a 31% increase in what that hour costs you, and the person is identical on both sides of the birthday. By 22 it is 34%.

And the cheapest hour of all is an apprentice. The apprentice rate is £8.00 an hour for anyone under 19, or in the first year of their apprenticeship. Employer National Insurance is 0% for an apprentice under 25 on an approved apprenticeship, up to £50,270. No pension until 22. That is £8.00 all in, against £14.52 for a 22 year old on the floor.

Before anyone reaches for the obvious conclusion: cutting someone's hours or letting them go because of their age is age discrimination, and the apprentice rate only applies to a genuine, approved apprenticeship, not to a junior you have decided to call one. The point of the arithmetic is to show you where your cost curve actually sits, not to hand you a scheme.

Before you redesign anything, check your Employment Allowance

Most small salons do not feel the 15% at all, and this is the bit that gets missed.

The Employment Allowance is £10,500 in 2026 to 2027. GOV.UK puts it plainly: "You'll pay less employers' Class 1 National Insurance each time you run your payroll until the £10,500 has gone or the tax year ends."

So your employer National Insurance bill is genuinely zero until it passes £10,500. Work out where that lands:

£10,500 divided by 15% is £70,000 of pay above the secondary threshold. A full-time adult on the wage floor puts about £19,784 above it. So the allowance covers roughly three and a half full-time adults on minimum wage, and then it is gone.

That threshold is the single most useful number in this whole piece. Below it, a pay rise costs you the pay rise. Above it, the same rise costs 15% more. If you are sitting just under, the next full-time hire is more expensive than the one before it, and you should know that before you make the offer rather than in March.

Note also that the £5,000 threshold is per employee, not per business. Four part-timers get four sets of it. Two full-timers get two. Splitting a rota across more heads uses up the allowance more slowly, which is one of the few places where the tax rules and a salon rota actually point the same way. Staff scheduling and labour cost goes into the rest of it.

Why the cheap end is being closed on purpose

Look at what happened in April 2026 rather than at the headline:

• 21 and over: up 4.1% to £12.71.
• 18 to 20: up 8.5% to £10.85.
• 16 to 17 and apprentices: up 6.0% to £8.00.

The junior rate rose at more than twice the pace of the adult one. In April 2025 the 18 to 20 rate was £10.00, which was 81.9% of the adult rate. A year later it is 85.4%. The gap closed by three and a half percentage points in twelve months.

That is deliberate. The government's remit to the Low Pay Commission restates its commitment to "removing the discriminatory age bands for adults and aligning the 18 to 20 year old National Minimum Wage with the National Living Wage". The Commission keeps discretion on timing, and it has published no estimate for the 18 to 20 rate in April 2027, so nobody can honestly tell you the number yet.

But the direction is stated policy, not speculation. Any staffing model built on the junior discount is built on a discount that is being closed on a schedule.

Seven months is the actual gift here

Every other cost lands on you. Rent reviews, energy renewals, supplier price lists, card fees. They arrive, and you react.

This one is different. You know roughly what it is, you know when it gets confirmed, and it does not start until April. That is seven months to do three things in the right order:

September to October: work out your exposure. Take your rota, mark everyone paid within 50p of the legal minimum for their age, and total their annual hours. Multiply by 47p, then by 1.18. That is your number. Not the sector's number, yours.

Late October: check the actual figure. On 28 October you find out whether the Commission's central estimate held, came in under, or went over. If it lands at the top of the range, 63p, your exposure is a third bigger than the planning number.

November to March: move your prices, not in April. This is the one most owners get backwards. If you raise prices in April, you have told every client that their haircut went up because of the government, which invites the conversation you least want. If you move in January, it is your price list, on your schedule, and you bank three extra months of the higher price before the cost arrives. How to raise prices covers the sequencing, and the pricing power calculator tells you which services can carry it.

What a buyer does with all this

Two salons, same turnover, same profit last year. One has moved its price list twice since 2025. The other has not moved it since 2024 and has absorbed two wage rises.

On paper they look similar. In a sale they are not close, for a reason that has nothing to do with the current accounts.

A buyer is not buying last year. They are buying next year's profit, and they can do the same arithmetic you just did. The adult wage floor has gone from £12.21 in April 2025 to £12.71 in April 2026 to a likely £13.18 in April 2027. That is 7.9% over two years on your largest controllable cost. A salon that has held its prices through that has a margin that is visibly shrinking on a trend line, and the buyer prices the trend, not the snapshot.

The other half of it is subtler. If you still work a full column yourself, your own labour is hiding inside the wage line as a cost nobody is paying. Seller's discretionary earnings adds your salary back, so on paper it looks fine. Then the buyer asks what it costs to replace your hours at £14.52 plus employer costs, and the number moves. The SDE calculator will show you the honest version before someone else does.

The fix for both is the same, and it is not a cost fix. It is revenue per hour worked. Utilisation rate is the metric, because a wage rise is charged per hour and can only really be recovered per hour. A column that is 60% full absorbs a 47p rise far worse than one that is 85% full, and no amount of rota juggling closes that gap.