(Recasts with minimum wage detail)
LONDON, Sept 10 (Reuters) - Next, Britain'ssecond-largest clothing retailer by sales value, said it wouldneed to raise its prices to pay for an increase in the minimumwage, becoming the latest company to warn on the impact of theBritish government's policy.
Finance Minister George Osborne in July announced a payincrease for the country's lowest-paid workers to countercriticism the benefits of economic recovery have not been sharedout fairly.
The hourly minimum wage will rise from next April to 7.20pounds ($11.1) for those aged over 25, from 6.50 pounds now, andto about 9.35 pounds an hour by 2020.
Next said that the total cost of the higher minimum wage,which the government has renamed the living wage, would be 27million pounds ($41.6 million) a year, and that it would need toincrease its prices by 1 percent to compensate for that cost.
Earlier this week Whitbread, which owns the CostaCoffee chain and is one of Britain's biggest employers, said itfaced a big rise in costs due to the wage reform and wouldprobably take on fewer extra staff.
Cleaning services firm Interserve said its 2016margins could take a hit of up to 15 million pounds, while Mears, a care worker company, said the cost of meeting thehigher wage bill would be up to 5 million pounds.
Britain's independent Office for Budget Responsibility hasestimated the new minimum wage will result in 60,000 fewer jobsand projected the cost to business would amount to 1 percent ofcorporate profits.
Publishing its half-year results earlier on Thursday, Nextsaid its profit rose 7.1 percent to 347.1 million pounds in thesix months to July after it sold more products than expected atfull price.
($1 = 0.6499 pounds)
(Reporting by Kate Holton and Sarah Young; Editing by PravinChar)
Next (NXT)
