Aldi has handed its UK store workers a second pay rise in just two months, underlining the fierce competition for staff among Britain’s biggest grocers — even as

the wider jobs market shows signs of cooling.

The discount retailer said more than 28,000 hourly paid employees will see their wages increase again from April 1, pushing Aldi ahead of rival Lidl’s most recent pay move. Outside London, store assistants will earn a minimum of £13.50 an hour, with higher rates in the capital.

The announcement comes at an interesting moment for the UK economy. Official figures released this month showed unemployment climbing to its highest level in more than a decade, excluding the pandemic period. Yet retailers appear unwilling to ease off on pay, suggesting frontline labour remains hard to secure.

Aldi had only just announced in February that it would lift hourly pay to £13.35 from March. That move was quickly overtaken after Lidl said it would pay 10 pence more per hour outside London, prompting Aldi’s latest increase.

Wage growth in retail is being closely watched by policymakers. The Bank of England has repeatedly said pay settlements are a key factor in deciding when and how far interest rates can fall, as it gauges whether inflation pressures are truly easing.

Supermarkets are not alone in lifting wages above inflation. Companies including John Lewis, Sainsbury’s and Costa Coffee have also announced annual pay rises that outpace the current inflation rate, which stood at 3% in January.

Meanwhile, the government-mandated national minimum wage is due to rise by 4.1% to £12.71 an hour in April. Some employers have warned the increase could feed through to higher prices, but Aldi’s latest move suggests major retailers believe competitive pay is now a cost they cannot avoid. Photo by Jivee Blau, Wikimedia commons.