GEORGE OSBORNE’s new so-called living wage will barely pinch bosses’ pockets and ­significantly improve the lives of those working in some industries, economists said today.

According to a new report by the Resolution Foundation think tank, half of all workers are set to benefit from the policy, will add only an extra 0.2 per cent onto employers’ wage bills.

The higher minimum wage will be introduced next April at the rate of £7.20 an hour, but is expected to rise to over £9 by 2020.

The real current living wage, as calculated by the Living Wage Foundation, is £9.15 an hour in London and £7.15 elsewhere in the country.

“The national living wage will give a welcome wage boost to six million workers,” said Resolution Foundation policy analyst Conor D’Arcy.

“With the economy getting stronger the vast majority of employers should be able to afford the new higher wage floor, which will allow their lowest-paid staff to share in the recovery.

“Past warnings about the negative effects of the minimum wage on employment have been wide of the mark.”

Mr D’Arcy added that, in particular, workers in the hospitality, retail and care industries would feel the improvement in their salaries.

“It’s not yet clear how employers will respond but, while some may opt to reduce hours or new hires, past experience tells us that most absorb the pressures via some combination of small increases in prices, a dip in profits and productivity gains.”

The findings fly in the face of complaints by three profitable companies — Next, Whitbread and Wetherspoons — about the cost of the new rate.

Both Next and Whitbread, which owns Premier Inn and Costa Coffee, warned of huge wage bills and threatened to raise prices.

However, Next recorded a 7.1 per cent rise in its profits in the first half of the year.

Whitbread chief executive Andy Harrison earns £1,000 an hour — his pay rising by 4.9 per cent last year compared to the 3.2 per cent rise for staff.

“The national living wage is an essential part of moving to a higher wage, lower tax and lower welfare society,” wheezed a Deparment for Business, Innovation and Skills spokesman.

Prisoners should be paid Osborne’s living wage

PRISONERS should be paid a living wage for work they do and be taxed on their earnings as part of a wider programme of rehabilitation, a leading criminologist said yesterday.

Paying inmates for doing jobs would help prevent reoffending, allow them to save money for their release and make them feel they are “part of civil society,” according to former prison governor Professor David Wilson.

He added: “People are sent to prison as a punishment, not for punishment, and giving them literacy, numeracy and work skills reduces their likelihood of committing further offences after they have been released.”

The living wage is currently £7.85 an hour outside London and £9.15 in London.

Tory Chancellor George Osborne announced in his budget a new compulsory so-called “national living wage” that will reach £9 an hour by 2020.

Prisoners are currently not subject to the national minimum wage, which stands at £6.50 for those over 21.