What is the real Living Wage?




What is it?

  • Only the real Living Wage is independently-calculated each year based on what employees and their families need to live
  • The current UK Living Wage is £8.45 an hour
  • The current London Living Wage is £9.75 an hour
  • Our Employers choose to pay the real Living Wage on a voluntary basis
  • The rates apply to all workers over 18 – in recognition that young people face the same living costs as everyone else
  • The real Living Wage that meets the cost of living enjoys cross party support, with public backing from successive London Mayors and MPs across the four nations of the UK
  • Paying a wage that is enough to live on is good for business, good for the individual and good for society
  • The Living Wage Employer Mark and Service Provider Recognition Scheme provide an ethical badge for responsible pay
  • How is it different from the government's 'national living wage'?

In April 2016 the government introduced a higher minimum wage rate for all staff over 25 years of age inspired by the Living Wage campaign - even calling it the ‘national living wage’.

However, the government's 'national living wage' is not calculated according to what employees and their families need to live. 

Instead, it is based on a target to reach 60% of median earnings by 2020. Under current forecasts this means a rise to less than £9 per hour by 2020. 

For under 25s, the minimum wage rates also take into account affordability for employers.

The real Living Wage rates are higher because they are independently-calculated based on what people need to get by. That's why we encourage all employers that can afford to do so to ensure their employees earn a wage that meets the costs of living, not just the government minimum.

You can read our response to the announcement about the minimum wage increase here (April 2015).

What are the benefits?

Good for Business

By paying the real Living Wage employers are voluntarily taking a stand to ensure their employees can earn a wage which is enough to live on. That basic fairness is at the heart of what our campaign is trying to achieve and why great businesses and organisations choose to go further than the government minimum.

Many employers also report wider business benefits as a result of investments in staff pay. 

An independent study found that more than 80% of London Living Wage employers believe that implementing the real Living Wage had enhanced the quality of the work of their staff. Two thirds of employers reported a significant impact on recruitment and retention within their organisation, while absenteeism had fallen by 25% on average. 70% of employers felt that the Living Wage had increased consumer awareness of their organisation’s commitment to be an ethical employer.


For people who are paid the real Living Wage it means the difference between just getting the government minimum and earning enough to afford the things you need to live, like a decent meal, a warm home and a birthday treat for your children.

Full time employees earning the real Living Wage earn £45 a week more than those on the government minimum, and £95 a week in London.

Many employees also report improved job satisfaction. An independent study found that 75% of employees reported increases in job quality as a result of receiving the Living Wage. 50% of employees felt that the Living Wage had made them more willing to implement changes in their working practices; enabled them to require fewer concessions to effect change; and made them more likely to adopt changes more quickly.

Good for Society

The Living Wage campaign was launched in 2001 by parents in East London, many of whom were working working two minimum wage jobs and still not able to make ends meet.

Low pay makes it difficult for employees to find time for community and family life. The causes of poverty are complex and in order to improve lives there should be a package of solutions across policy areas. The Living Wage can be part of the solution.