Low pay nation

The shocking extent to which low pay has gripped the entire country was laid bare today (August 24) in new figures published by the Labour Party.

The analysis of workers in the UK earning less than the Living Wage showed that the blight of low pay does not discriminate – it’s pervasive in cities and rural areas, wealthier boroughs and more deprived ones, north and south.

West Somerset topped the list with the highest proportion of workers earning less than the Living Wage, which is the minimum rate needed to maintain a basic standard of living. There, nearly half – 41 per cent – of the working population does not earn enough to live decently.

This was despite West Somerset having among the fastest rising house prices in all of the UK – they rose more than 10 per cent in the year to May to £344,800.

In the UK’s cities, low pay is just as prevalent. More than 100,000 workers in Birmingham earn below the Living Wage – that’s nearly one out of every four people in the working population in the city.

In Liverpool and Newcastle, too, about one in every four working people do not earn enough to maintain a basic standard of living, amounting to 50,000 people in Liverpool and 37,000 in Newcastle.

In Leeds, Glasgow and Manchester, nearly one in five earn below the Living Wage. And even leafy, ostensibly affluent suburbs such as Tunbridge Wells and Epsom and Ewell cannot escape Britain’s low pay disease – in these areas, too, nearly one in five earn less than the Living Wage.

 

Cornwall, studded with holiday homes worth millions of pounds, has among the highest concentration of low-paid workers – there, a shocking one in three, or 56,000 working age people struggle to put food on the table and keep a roof over their heads.

A typical salary in Cornwall is £15,000 to £17,000 but the average house price is 18 times this salary – £324,000.

The Living Wage is calculated each year by the Living Wage Foundation based on what a person living in London or in the rest of the UK would have to earn to have a roof over their heads, put food on the table and care for their children.

The London Living Wage is now set at ÂŁ9.75 an hour and ÂŁ8.45 in the rest of the country.

Shameless rebranding

But the government’s so-called National Living Wage (NLW), a shameless rebranding of the mandatory minimum wage, is only £7.50 an hour now – and it applies only to those workers who are over 25. Young people between 21 and 24 are entitled to a meagre £7.05 an hour and those younger still are paid an even lower minimum wage rate.

A new analysis this week from the Child Action Poverty Group (CAP) found that the government’s minimum wage falls far short of what’s needed to raise one child. Two parents working full-time on the minimum wage, the organisation found, will be £59 short a week to meet their child’s most basic needs.

The Labour Party said it will raise the living standards of millions of the lowest paid workers in the UK as it renewed its commitment today (August 24) to raise the minimum wage to the real Living Wage, expected to be ÂŁ10 an hour by 2020.

Labour has said it will end the government’s minimum wage age discrimination when it is in power, ensuring that all workers, no matter how old they are, earn the “real” Living Wage.

The government’s minimum wage lags far behind the real Living Wage – according to forecasts by the Office for Budget Responsibility (OBR), it will only be £8.75 an hour by 2020, under the £9 an hour the government had promised. Young workers will struggle on an even lower wage of £7.75, according to the OBR’s forecasts.

Such rates will only prolong the decade of falling living standards that millions of workers have had to endure.

Potential to make a difference

In this climate of wage stagnation and rising inflation, Labour’s plan to significantly raise the minimum wage has the potential to make a real difference for low-paid workers.

Under the Labour Party’s proposals, full-time workers on the minimum wage will be £2,500 better off in 2020, and workers aged 21 to 24 will be £4,500 better off in 2020.

Shadow secretary for business, energy and industrial strategy Rebecca Long-Bailey highlighted that “the stagnation of real wages has been unprecedented since at least the Second World War.

“We must take bold and imaginative measures to tackle low pay,” she said. “One crucial step in this direction is to raise the Minimum Wage to the level of the Living Wage, expected to be at least £10 per hour by 2020, – for all workers aged 18 or over.

“People should be rewarded for a full day’s work and need the dignity that comes with decent wages. Britain needs a pay rise and only a Labour government can deliver one.”

Unite has long been campaigning for an across-the-board rise in the minimum wage to the real Living Wage, and while the union fights on the political stage for all workers, it fights for its members in specific workplaces too.

One successful campaign saw Unite members, cleaning staff for Hackney council, win the Living Wage last year.

Unite assistant general secretary, Steve Turner, said raising the minimum wage to the real Living Wage would be a good first step in helping working people maintain a decent quality of life, but that more action is also needed.

“Workers have suffered the longest squeeze in living standards in recorded history in recent years, thanks to the actions of this government and its predecessor,” Turner said.

“An increase in the minimum wage to £10 would benefit those on the lowest wages and is one of a number of measures that need to be enacted to prevent the economy and peoples’ living standards from plummeting. These include ending the freeze on working age benefits and the real cuts to public sector pay.

“Most importantly of all, we need public investment to create jobs and stimulate the economy and an end to the Tories’ counter-productive reign of austerity.”