RSS Feed

Legal Updates

More Articles: Latest Popular Archives

Number of workers paid below the living wage projected to reach over 5 million next year

Makbool Javaid, Partner - Simons Muirhead & Burton

New research by the Living Wage Foundation demonstrates that, despite the number of workers earning below the real Living Wage standing at the lowest it has been in 10 years (3.5 million), this is a ‘lull before the storm’ with the number of jobs paying below the real Living Wage forecast to jump to 5.1 million next year as wages continue to lag behind inflation amid the cost-of-living-crisis.

According to the latest analysis of the Annual Survey of Hours and Earnings (ASHE) from the Office for National Statistics (ONS), 1 in 8 workers in the UK are earning less than the real Living Wage. This equates to 12.2% of all employee jobs and a total of 3.5 million.

This is the largest drop in a single year, with the number of workers earning below the real Living Wage falling by 4.9 percentage points since April 2021, when 4.8 million workers were paid below the Living Wage. According to the data, this is the lowest the figure has been in 10 years.

However, while the statistics appear positive, new research by the Living Wage Foundation published today forecasts this drop in low paid jobs is set to bounce back next year, with the number of workers earning below the real Living Wage now forecast to jump up to 5.1 million (1 in 5 jobs).

The real Living Wage is the only wage rate calculated based on what people need to live on. It currently stands at £10.90 (UK) and £11.95 (London). For a full time worker, that represents £2,730 more than someone earning the government’s National Living Wage. A worker on the London Living Wage would be almost £5,000 better off than someone on the National Living Wage.

Over 11,000 UK businesses are accredited with the Living Wage Foundation, including Aviva, Everton FC and LUSH, as well as thousands of small-to-medium sized businesses. 370,000 UK workers receive an annual pay rise to the real Living Wage rates because of their commitment to always paying the real Living Wage.

Receive more HR related news and content with our monthly Enewsletter (Ebrief)