Further increases to minimum wage could lead to job losses

The survey, conducted by the British Retail Consortium (BRC), shows that 44 per cent of retailers said they would be forced to make job cuts if the Low Pay Commission recommends an increase in the minimum wage, raising it to £5.20.

Results also show that the previous rise in October, to £4.85, has already cost retailers as much as £1.7 billion.

The Trade Union Congress (TUC) backed the October rise, arguing that every increase to the minimum wage since 1999 has been absorbed by the economy without any diverse effect.

However, the trend has also been criticised by the Confederation of British Industry (CBI) who believe increasing employment costs may lead to job losses in other areas, as businesses shift their employee base to more affordable parts of the world such as India and China.

Kevin Hawkins, BRC director general, said: “The survey has confirmed retailer's fears, that an ill thought out decision on this will hit every retailer hard.

“The retail industry employs 2.8 million people – 11% of the total UK workforce but many retailers will have no choice but to make job cuts.

"We have provided the evidence and it is now up to the Low Pay Commission to act appropriately and keep the wage at a sensible level in line with current economic conditions."