5.8 million UK workers earn less than the Living Wage

ALMOST six million Britons are earning less than the Living Wage and the proportion of workers not paid enough to allow the purchase of basic necessities is rising steadily.

Figures from leading accountancy firm KPMG, published ahead of Living Wage Week which begins today, show that 23 per cent of employees – 5.84million people – earn less than the Living Wage. The number is up from 22 per cent last year and 21 per cent the year before.

The latest rise of 497,000 people in a year came despite increased awareness of the Living Wage, which is an hourly rate calculated according to the cost of living and is paid on a voluntarily basis.

During the same period the total number of jobs increased by 345,000 to just over 25million.

The research revealed that parttime, female and young workers are the most likely to earn a wage that fails to provide a basic standard of living. It found that 29 per cent of women earn less than the Living Wage, compared with 18 per cent of men.

Younger workers suffer the most with 72 per cent of those aged 18 to 21 earning less than the Living Wage, compared to 17 per cent of those aged 30 to 39.

The Chancellor’s plan to introduce what he calls a National Living Wage has raised fears among some employers. John Longworth, director general of the British Chambers of Commerce – which will today announce that it is now a Living Wage employer – said: ‘Many in business will have concerns about the Government’s decision to introduce big minimum wage rises.’

Business groups have argued that

pay rises affect their profits, though a quarter of FTSE 100 companies are now committed to paying the Living Wage.

The Living Wage movement regards a fair minimum pay figure for workers of all ages as being £7.85 per hour outside London and £9.15 in the capital.

However, George Osborne’s compulsory National Living Wage will be set at £7.20 an hour for those aged 25 and above from next year and will rise to £9 an hour by 2020.

This is higher than the current minimum wage of £6.70, but still lower than the Living Wage Foundation recommends.

Mike Kelly, head of Living Wage at KPMG, said: ‘The squeeze on household finances remains acute. The figures today show that there is still more to be done if we are to eradicate in work poverty.’