Nearly 5 million workers paid below 'living wage'

As many as one in five workers – some 4.82 million people – are paid less than a 'living wage', according to a new analysis.

The study is published by a leading accountancy firm that supports the living wage for its own employees.

A living wage was calculated to be £8.30 an hour in London in 2011 (£7.20 outside), based on what was needed by the average household type to cover basic living costs. This compares with the current statutory minimum wage of £6.08. An uprated living wage calculation for 2012 is expected to be published soon.

Key points

  • Northern Ireland has the highest proportion of people earning below a living wage at 24 per cent, followed by Wales at 23 per cent. The lowest proportion is in London and the south east, both at 16 per cent.
  • Jobs with the highest proportion of workers paid below a living wage are bar staff (90 per cent) and waiters/waitresses (85 per cent).
  • 41 per cent of those earning below a living wage feel their finances have got worse in the last month (compared with 25 per cent of those earning above). And 47 per cent expect their finances to be in a worse state in a year’s time than now (compared with 43 per cent of those earning above).
  • 23 per cent of those earning below a living wage feel their job security has got worse in the last month (compared with 16 per cent of those earning above).
  • Since 2001 the living wage campaign has boosted the incomes of over 10,000 employees and their families, by a total of over £96 million.

Source: Markit Group, Living Wage Research for KPMG: Current Trends in Household Finances and Structural Analysis of Hourly Wages, KPMG
LinksReport | KPMG press release | Labour Party press release | Guardian report | Telegraph report

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