Over 20% of the UKís workforce earn under the Living Wage - An enquiry into the proposed 20p rise



Over 20% of the UKís workforce earn under the Living Wage - An enquiry into the proposed 20p rise

Over a fifth of the UKís workforce make less than the living wage, barely enough to make ends meet, with women and young workers particularly likely to be on the wrong end of paltry hourly rates.

The current living wage - which is calculated to signify the amount needed for a decent albeit rudimentary standard of living - stands at £8.80 in London and £7.65 in the rest of the country, and despite the economic recovery and falling unemployment levels in 2014, a new report from KPMG has shown a rise in the number of people being paid under the living wage for the year. Although the rise is seemingly trifling in percentage terms, having climbed just 1% to 22%, this figure represents another 147,000 workers being deprived of a suitable standard of living, swelling the total number of those indigent to 5.28m.

Based on research from leading financial information service, Markit, the report was published to herald the commencing of ëLiving Wage Weekí, yet its findings represent a fairly tuneless fanfare as far as tireless breadwinners across the country are concerned.

That the groups most eligible for poor pay include the young and women makes for some gloomy inferences. The disillusionment stemming from terrible pay despite so much talk of economic growth could have a dampening, alienating effect on the UKís young, whilst women still being at the bottom of the pay ladder will have equal rights campaignersí heads spinning wondering how glass ceilings can still prove so shatterproof in todayís social climate.

Mike Kelly, head of living wage at KPMG, urged policymakers to review their position on widespread formal implementation of ëthe living wageí whilst pointing to concrete economic rationale to reinforce his perspective.

He posited: ìFor some time it was easy for businesses to hide behind the argument that increased wages hit their bottom line,î he said referring to the wage stagnation seen in the UK since the financial crisis.

ìBut there is ample evidence to suggest the opposite ñ in the shape of higher retention and higher productivity,î he added.

ìIt may not be possible for every business, but it is certainly not impossible to explore the feasibility of paying a Living Wage.î

ï    Markitís research shows that 72% of UK workers aged between 18 and 21 earn under the living wage, whilst only 15% aged between 30 and 39 take home less.

ï    25% of women, compared with 16% of men, earn less than the living wage

ï    42% of part-time workers earn less than that required to live ëdecently, compared with 13% of full-time employees.

ï    90% of bar workers, 85% of waiters and 80% of other catering positions take home paltry pay packets ñ Retail is the most notoriously underpaid job with over 90% paid under the living wage.

20p rise in living wage to be implemented ñ But what could this really mean for the public?

Whilst only a voluntary scheme, carrying no obligation or legal necessity, much has been made about the living wage campaign initiated by Citizens UK in 2001. Their efforts have resulted in increasing numbers of employers committing to paying that little bit extra to give their employees some extra financial freedom.

Although the proportion of employees under the living wage has risen, the number of companies adopting it has soared, aided by some of the most reputable names in businessí backing, with HSBC, Nestle and Barclays all having endorsed the living wage campaign.

A fresh report from Citizens UK shows exponential growth in the number of companies taking up the living wage in the last 13 years, with over 1000 now advocating the cause.

This added coverage has led to policymakersí deciding to lift the living wage for those outside the capital by 20p to £7.85, whilst Boris Johnson announced plans to raise the living wage for Londoners by 35p to £9.15.

Whilst any legislative reform can be counted as a success for the campaign, given the living wageís lack of any legal credence, and an example of what can be achieved by the worthy efforts of consumer groups in any field, KPMGís report highlights just how much work still needs to be undertaken.

The national minimum wage is widely thought of as almost archaic and completely unrepresentative of what it costs to subsist. Those at the Low Pay Commission surely must be forced to reconsider their position in light of both KPMGís findings and the decision to lift the living wage.

Moreover, critics of the minimum wage suggest low pay begets further economic trouble, as these workers seek relief in the form of benefits further burdening the taxpayer.

Thus, a rise in the living wage, no matter how small, has significance beyond just personal finance enhancement. Rather, it ought to represent a wake-up call to the Chancellor, the low pay commission and policymakers everywhere that Britainís workforce is tired of living hand to mouth, sick of skimping to make ends meet and done with days of destitution and belittlement.

This is the message sent out by TUC general secretary, Frances OíGrady, who declared: ìLow pay is blighting the lives of millions of families. And itís adding to the deficit because it means more spent on tax credits and less collected in tax. We have the wrong kind of recovery with the wrong kind of jobs ñ we need to create far more living wage jobs, with decent hours and permanent contracts.î