The government’s decision to increase the minimum wage to £5.52 an hour, from £5.35, has been widely welcomed.

More than a million workers, two-thirds of them women, will benefit from the rise. Pay for 18 to 21 year olds has increased to £4.60, from £4.45, and from £3.30 to £3.40 for 16 to 17 year olds.

John Philpott, chief economist at the Chartered Institute of Personnel and Development, says: “The Low Pay Commission has served to strike a fair balance on the low pay or no pay spectrum and today’s recommendation is no different. A cautious increase this year, in line with what price inflation will probably be come the autumn, seems sensible.”

The CBI also welcomed the decision. Its deputy director general John Cridland says: “The minimum wage has brought real benefits to many lower paid workers, but it is right that this year’s increase took account of business reality.”

However The Employers Forum on Age says the minimum wage structure discriminates against younger workers. Director Sam Mercer says: “We are frustrated by the refusal to address that under the current bands, 18 to 21 years old are paid less, simply because of their age and irrespective of their capabilities or responsibilities.”