John Lewis hands shop workers 7.4% pay rise
Before I go, our retail correspondent Sarah Butler has sent this across:
John Lewis is handing its shop workers a 7.4% pay rise to a minimum of £12.40 an hour - with some deemed to have made an “exceptional contribution” to the group getting 2% more.
The group, which owns 36 department stores and the Waitrose supermarket chain, said it was investing £114m in raising pay for 65,000 people across the business, taking the minimum hourly rate well above the new legal minimum wage of £12.21 from April for over-21s. However the rate is 20p an hour behind Marks & Spencer’s pay rise announced this week and 31p behind B&Q’s latest rate.
John Lewis’s decision to hand an extra pay rise to some workers linked to performance is also likely to prove controversial at the staff-owned business which has not paid an annual bonus for workers for two years and is thought unlikely to announce award a bonus alongside its annual results next week.
In 2021, it emerged that 16 special contribution bonuses went to directors and heads of departments when the vast majority of workers did not receive an annual bonus.
Closing summary
The European Central Bank has cut interest rates across the 20-member eurozone for the second time this year, and warned that trade war fears were hurting Europe’s economy.
The Frankfurt-based rate setter cut its benchmark deposit rate by a quarter of a percentage point to 2.5%, in line with City economist expectations, as Donald Trump has threatened 25% tariffs on all goods imported from the EU, similar to levies on imports from Canada and Mexico that took effect this week.
The ECB president, Christine Lagarde, blamed a “high level of trade and policy uncertainty” for a downgrade in growth this year.
“We know that tariffs, and particularly if there is retaliation, are not good at all and are net negative on pretty much all accounts,” she told journalists at a press conference. She explained that the threat of tariffs is also damaging because such fears put “a brake on investment, on consumption decisions, decisions on employment, hiring and all the rest of it”.
There was better news on the battle against inflation, which the ECB said was moderating.
Economists concluded that there are more rate cuts to come but that the pace of easing will be slower.
The euro rallied, rising by 0.5% to $1.084. Sterling is also higher, up 0.1% to $1.2911, as the dollar continues to slide against major currencies.
Germany’s Dax has climbed 0.85% and the Italian stock market is 0.7% ahead while the French bourse is flat and the UK’s FTSE 100 index lost 0.77%, following a gloomy construction survey.
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Thank you for reading. We’ll be back tomorrow. Take care – JK
