NEWS: Living Wage Foundation Welcomes Pay Rise For UK’s Poorest Workers, But Urges Employers to Go Further
Today the government’s National Living Wage (NLW) will rise from £7.83 to £8.21 for workers over 25.
Research conducted by the Living Wage Foundation shows that a worker on the new government minimum would earn an annual salary worth £1,540.50 a year less than the real Living Wage, based on what employees and their families need to get by (1). It would take 25 additional working days to make up this shortfall, the equivalent of working 5 weeks extra every year. (2)
This additional £1,540.50 could pay for:
- Almost six months’ food and drink bills for an average household - £1,575.60 (3)
- Over a year’s average gas and electricity bills - £1,322 (4)
- Over 2 months' average rent - £1,422 (5)
For workers in London the gap is even wider, with full-time workers earning the new government minimum set to earn £4,563 less than those earning the independently-calculated London Living Wage. These workers would need to work 49 more days to earn a real Living Wage, or well over two months more.
Katherine Chapman, Director of the Living Wage Foundation, said:
“Today’s increase in the government minimum wage will provide a welcome boost to low pay workers. But around 6 million workers still earn less than the real Living Wage and struggle to keep their heads above water. Many are unable to afford even the basics like decent family meals, or a warm and safe home. Over 5,000 responsible employers have gone beyond the government minimum and committed to pay a real Living Wage. We now need to see more businesses step up a provide a wage that truly covers the cost of living.”
The gap between the government minimum and the real Living Wage is widest for young people aged 18-20. They would earn just £11,992.50 a year, or £5,557.5 a year less than a full-time worker of the same age earning a real Living Wage. They would need to work 90 extra days, or over 18 weeks longer, to earn a real Living Wage.
More than 5000 employers have signed up to go further than the government's minimum, and pay their staff a real Living Wage. Join the movement for a real Living Wage and accredit today.
- These calculations are based on working for 37.5 hours a week, for 52 weeks. £9 x 37.5 x 52 = £17,550 for someone earning the real Living Wage, compared to £16,009.50 for a full time worker, over the age of 25 (and therefore eligible for the National Living Wage), earning the Government’s new National Living Wage rate of £8.21
- Not including weekends, 25 days would equal 5 weeks' additional work.
- Average weekly household food and drink bill is £60.60 x 52 weeks = annual food and drink bill of £3,151.2 Half of this is £1,575.60
- Combined prepayment average gas and electricity bill = £1,322. (DECC Quarterly energy prices, 2017
- In 2016-17, the average private rent outside London was £158 per week. Nine weeks (over 2 months) private rent is therefore £1,422