The rate will come into force in October and will result in a pay rise for more than 1 million workers.
The British Retail Consortium (BRC) called the 3 per cent increase excellent news for retailers.
BRC director-general Kevin Hawkins said: 'This is good news and exactly what we asked for. The BRC is the only business organisation that has consistently argued for no real-terms increase in minimum wage costs and backed that up with detailed evidence which, we believe, impressed the Low Pay Commission.
'Hard-pressed retailers have had to cope with a£2.7 billion hike in wage bills caused by the previous two above-inflation increases.'
The BRC's survey of retailers indicated that 78,000 retail jobs were lost between 2005 and last year.
Hawkins added: 'With energy prices, rents, rates and service charges also on the increase, cutting staffing costs by employing fewer people would have been one of the few ways retailers could have accommodated another inflation-busting increase.
'What retailers want is an end to this annual uncertainty. There should be no real-terms increase next year while the commission reviews the future direction of the minimum wage and produces, what we hope will be, a more predictable formula for future changes. We will be contributing some constructive and practical ideas to this review.'
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