The Confederation of British Industry (CBI) director-general has branded the increase to the national minimum wage a “gamble” and claims many employers will have to change their business models as a result.
Speaking at King's College London, John Cridland will warn of the damage that measures such as the mandatory National Living Wage could have on UK employment.
The National Minimum Wage (NMW) is set to increase by 20p to £6.70 in November, with the top-up national living wage announced in the Summer Budget taking that up to £7.20 in April.
Cridland will say: "I've talked to many CEOs who feel they may now have to make changes to their business models, which could result in fewer job and progression opportunities."
And he will urge caution over the introduction of the National Living Wage, arguing for a revision and to close the education gap.
"It is business investment which drives productivity growth," he will add.
"And it is productivity on which wage growth depends. All three are now rising.
"But wages can only grow as businesses grow. A £7.20 National Living Wage in 2016 and a £9 National Living Wage by 2020 are laudable objectives, but they are a gamble.
"They depend on organic productivity improvements. And we should be careful what we wish for. Our jobs-rich recovery is a success which depends on entry level jobs and progression routes on our high streets and in our leisure sector."