UK
3.7M JOBS PAID BELOW THE REAL LIVING WAGE IN FIRST RISE SINCE 2020
200,000 MORE LOW-PAID JOBS THAN IN 2022
1 in 8 (12.9%) of UK jobs are now paid below the real Living Wage.
Hospitality has the highest rate of low pay, with nearly half (48.1%) of all jobs in the sector paid below the real Living Wage.
North East England has the highest rate of low pay of any region, with 1 in 6 (15.9%) of jobs paid below the real Living Wage.
The real Living Wage, as set by the Living Wage Foundation, is the only wage rate based on the cost of living. It is currently £12 in the UK and a higher rate of £13.15 in London.
- Over 14,000 UK businesses are accredited with the Living Wage Foundation, including Aviva, Everton FC, Burberry, IKEA, LUSH and Nationwide.
New analysis of the latest Annual Survey of Hours and Earnings from the Office for National Statistics (ONS), by the Living Wage Foundation, reveals that the number of low paid jobs has risen for the first time since 2020, with 3.7 million UK jobs, or 1 in 8, paid below the real Living Wage in April 2023, 200,000 more than a year earlier.
The hospitality sector has the highest rate of low paid jobs, with nearly half (48.1%) of all jobs in the sector paid below the real Living Wage. This is roughly twice as high as the next two sectors with the highest rate of low pay; ‘arts, entertainment and recreation’ (24.7%) and ‘retail and wholesale’ (23.2%). Hospitality has been the sector with the highest level of low paid jobs for 12 years running.
Recent Living Wage Foundation research shows hospitality businesses could benefit from paying staff the real Living Wage, with 66% of Londoners polled saying they would be more likely to choose such venues and 60% willing to pay more for them.
As Table 1 shows, the region with the highest rate of low paid jobs is the North East (15.9%), closely followed by East Midlands (15.7%) and Northern Ireland (15.6%).
The ten local authorities with the highest levels of low pay are: Haringey (32.7%), Brent (29.5%), Waltham Forest (28.8%), Bexley (28.5%), Redbridge (28.2%), Hyndburn (26.3%), Harrow (26.1%), Mansfield (25.3%), East Lindsey (25.0%), and Thanet (24.7%).
The level of low paid jobs in the UK was lower than expected in 2023 due to higher-than-expected levels of nominal wage growth and sharp increases to the National Living Wage.
Recent research published by the Living Wage Foundation found that despite easing inflation, the cost-of-living crisis is far from over for low paid workers. 39% of those earning less than the real Living Wage report regularly skipping meals for financial reasons during the year to August 2023. 32% have been unable to heat their homes and 27% have fallen behind on their rent or mortgage payments. 52% said that earning less than the real Living Wage during the cost-of-living crisis has negatively impacted their mental health.
The real Living Wage is the only wage rate calculated based on what people need to live on. It currently stands at £12.00 (UK) and £13.15 (London). For a full-time worker, that represents £3,081 more than someone earning the government’s National Living Wage. A worker on the London Living Wage would be £5,323.50 better off than someone on the National Living Wage.
In the past two years record numbers of employers have signed up to pay the real Living Wage, including to their third-party contractors like cleaners and security guards, with 1 in 9 employees now working for an accredited Living Wage Employer. Over 14,000 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. Over 460,000 UK workers receive an annual pay rise to the real Living Wage rates because of their commitment to always paying the real Living Wage.
Over 130 accredited Living Hours employers, including abrdn, Aviva, and West Brom Building Society, go beyond payment of the real Living Wage to also provide a guaranteed minimum of 16 hours work a week, a month’s notice of shift patterns and a contract that reflects hours worked.
Nearly 30 employers, including Aviva, Wealthify, Phoenix and Herbert Smith Freehills are leading the way in tackling low pension saving amongst their workers through Living Pension accreditation.
Katherine Chapman, Living Wage Foundation Director, said:
“The campaign for a real Living Wage has had a huge impact tackling in work poverty, with over 460,000 workers now receiving an annual pay rise thanks to the commitment of 14,000 accredited Living Wage employers. However, today’s findings show there is more to do with 3.7 million workers not earning a wage in line with the cost of living.
With the cost-of-living crisis far from over, earning a real Living Wage has never been more important. Employers who want to do the right thing and protect their staff from rising prices can do so, by joining the 14,0000 Living Wage employers who are committed to always paying a wage in line with the cost of living.”
Nigel Derrett, owner of Newington Fish Bar, the only Living Wage accredited hospitality venue in Thanet, said:
"When you have a staff team that works well together, interacts with the customers and makes them feel welcome, that when it gets busy go that extra mile to keep all the customers happy and served efficiently, you need to show that they are appreciated and paying them a Living wage or higher is just one of the best ways of doing this. When your workers feel valued it makes them more eager to do their best. Customers will soon pick up on contented workers which ultimately helps the business flourish. I feel if you don't reward staff properly, they will look elsewhere for a better rate and I would lose a valuable employee.”
Summer Scholes, employee at Newington Fish Bar, said:
“Last summer I spent 7 days a week on low pay trying to pay my bills, leaving me unable to buy many essentials throughout the month. However, this year whilst being paid by a real Living Wage employer I have been able to pay my bills, get the essentials I need and save some for my future studies. Above all I feel I'm a valued member of the team.”
Ed Mason, our Director and Co-Founder of The Five Points Brewing Company:
“The Five Points Brewing Company was the first UK brewery to be an accredited Living Wage Employer, and we remain committed to paying the London Living Wage as a base rate to our staff in our brewery as well as at our hospitality venues: The Five Points Taproom & Courtyard and The Pembury Tavern. Good wages bring good people into the business, and being paid a fair wage increases staff morale, investment and retention.”
Jon Sibley, Landlord of the Town Mouse Ale House in Newcastle, said:
"Ensuring my staff receive a living wage is a top priority because I want to pay a salary that they can actually live on. I genuinely appreciate the dedication my team shows. Hospitality is about long shifts, physically and mentally intensive graft and people working within our industry deserve to be recognised for the work they do, and not be forced out of a career they love due to poor pay and conditions. We are a small community pub where our employees' relationship with our customers is incredibly important, customers recognise this and keep coming back. At a time where pubs and hospitality is struggling as an industry, retaining experienced staff that customers love to see is all important."
Peter Gibbs, Manager of the Volunteer Tavern in Bristol, said:
"Being a Real Living Wage employer has increased sales because customers have told me they go out of their way to support an ethical business. Staff are happier working here which means we have a high retention rate meaning we did not suffer when all other businesses were struggling to get staff. But mainly, it's just the right thing to do for a functioning society".
Seb, 34, employee at Meetini, a sustainable mobile cocktail bar company based in in Haringey, said:
“Getting the real Living Wage at Meetini has made a big difference for me. It's more than a paycheck; it's feeling valued and less stressed. Now, I can focus on work without worrying about bills. It's a small change that means a lot.”
Table 1. Employee jobs paid below the real Living Wage by region: April 2023
Notes on data:
Data on the proportion and number of jobs paid below the Living Wage comes from the Annual Survey of Hours and Earnings (ASHE). Carried out in April each year, ASHE is the most comprehensive source of information on the structure and distribution of earnings and hours worked among employees in the UK. ASHE is based on a 1 per cent sample of employee jobs taken from HM Revenue & Customs (HMRC) Pay As You Earn (PAYE) records.
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