Plans to increase the minimum wage by 1.8% for adult workers, and a freeze for workers under 20 is being criticised by the TUC as not enough to ease financial strains on low-paid workers in real terms.

The rate of inflation is currently running at 2.9% (RPI).

Brendan Barber, TUC General Secretary, said: “While we are pleased that government has rejected the siren calls of some employers to freeze the minimum wage for adult workers and apprentices, these increases are still far below inflation and will leave the lowest paid facing a real terms cut.

“These new rates are a particular blow to younger people who will face the biggest hit on their living standards.

“There is no evidence that the minimum wage has had an adverse impact on young people’s employment so it is hard to see the logic behind their pay freeze.”

The TUC also highlights that the rate increase is not high enough to help cash-strapped families struggling to meet the basic costs of living.

Barber added: “We need a bolder increase next year otherwise the real incomes of minimum wage workers will continue to fall, along with consumer demand.”

From October 2012:

• The adult rate will increase by 11 pence to £6.19 an hour
• The rate for 18-20 year olds will remain at £4.98 an hour
• The rate for 16-17 year olds will remain at £3.68 an hour
• The rate for apprentices will increase by 5 pence to £2.65 an hour and
• The accommodation offset will increase by 9 pence to £4.82 per day.