Five million paid less than living wage

| October 29, 2012
Five million paid less than living wage

Five million people in the UK are paid less than the ‘living wage’ of £7.20, or £8.30 in London, according to a new report by KPMG.

In Northern Ireland, 24 per cent of workers receive less than they require in order to pay for essentials and the situation is little better in Wales where 23 per cent of people earn less than the living wage.

Hospitality work is particularly badly paid with just 10 per cent of bar staff and 15 per cent of waiters and waitresses earning enough to maintain a basic standard of living.

A large majority of kitchen, catering, laundry and cleaning staff are also paid less than the living wage.

The ‘living wage’ is higher than the National Minimum Wage of £6.19 for people aged 21 and over.

While employers are legally obliged to meet the National Minimum Wage, the living wage is a voluntary rate of pay that employers can sign up to.

The London Living Wage is calculated by the Greater London Authority while the Centre for Research in Social Policy calculates it for the rest of the UK.

Marianne Fallon, head of corporate affairs at KPMG, said: “Paying a living wage makes a huge difference to the individuals and their families and yet does not actually cost an employer much more.

“Tackling in-work poverty is also vital if we are to enable more people to improve their life prospects and increase social mobility in this country.”

KPMG’s research found that finances have deteriorated for 41 per cent of low-paid workers in the last month.

Meanwhile, price comparison site uSwitch.com has warned that a 156 per cent increase in energy prices over the past seven years has pushed 7.2 million UK households into fuel poverty.

Household energy bills cost a total of £753 million more than they did seven years age, with the average annual energy bill expected to rise to a record £1,334 by the end of the year.

Fuel poverty is defined as when a household spend more than ten per cent of its net income on energy and fuel for their homes.

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