Here are all of Britain's biggest companies that will be hit hardest by National Living Wage costs
But Julia Dawson and the rest of her team at Credit Suisse warn that while this is great for the worker, there are certain industries that will be hit hard by the rise in salary costs - travel, leisure, and retail.
In July, UK Chancellor George Osborne said the government would scrap the National Minimum Wage - £6.50 an hour for workers - for a new "National Living Wage" of £7.20 for workers over the age of 25, in April next year.
The National Living Wage is intended to pay employees the minimum amount to live a "normal" standard of living. For example, a full-time waitress should be able to live off her low wages and afford rent, food, transport, and bills without having to take a second job or an exceptional amount of extra hours.
By 2020, the National Living Wage should rise to £9.
Dawson and the rest of the Credit Suisse analysts pointed out that "we think wage increases may have a bigger impact than companies have signalled so far." In other words, companies are either being too cautious or too optimistic about how the increase in costs is going to affect the firm in the longer term.
Here is a chart where Credit Suisse shows earnings sensitivities and forecast changes for some of Britain's biggest companies in the travel, leisure and retail sectors:
Companies across Britain have either waged war against the government regarding the enforced National Living Wage rule while others have already boosted wages so the rise in costs doesn't come as an absolute shock to its balance sheet.
In October, Whitbread, the owner of Costa Coffee, warned investors that the National Living Wage will cost the group as much as £20 million ($31 million) a year. A month earlier, massive budget pub chain Wetherspoons launched a scathing attack on government for the National Living Wage.