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Living Wage workers set for a pay boost

Over 300,000 people working for almost 9,000 real Living Wage Employers throughout the country are set for a vital pay boost as the new Living Wage rates rise to £9.90 across the UK (40p increase), and £11.05 in London (20p increase), supporting workers and families. The Living Wage rates are the only rates independently calculated based on what people need to live on. 

This year the movement for a real Living Wage celebrates its 20th year, with new research from the Cardiff Business School showing Living Wage workers have benefited from more than £1.6bn in extra wages during this period. One in 13 workers now work for an accredited Living Wage Employer.  

The new Living Wage rates and the ‘National Living Wage’ - know the difference 
Unlike the Government Minimum Wage (‘National Living Wage’ for over 23s - £8.91 rising to £9.50 in April) the real Living Wage is the only wage rate independently calculated based on rising living costs – including fuel, energy, rent and food. A full-time worker earning the new, real Living Wage would earn £1,930 a year more than a worker earning the current Government minimum (NLW). For a worker today that’s the equivalent of seven months of food bills and more than five months' rent based on average household spending in the UK. Even on next April’s higher NLW rate of £9.50, a full-time worker on the real Living Wage would earn £780 more. 

In London, a full-time worker on the new real Living Wage rate would earn an additional £4,173 a year compared to a worker on the current NLW and £3,022 more than a worker on next year’s National Living Wage.  

The increase in Living Wage rates this year has largely been driven by rising fuel and rent costs.

The Living Wage movement continues to grow 
Major new Living Wage employers include FTSE 100 construction firms Taylor Wimpey and Persimmon Homes, Fujitsu, food delivery company Getir, and Capita. They join half of the FTSE 100 companies, household names like Aviva, Everton FC, Burberry and Lush as well as thousands of small businesses, who are choosing to pay the real Living Wage to ensure all staff earn a wage that meets the real cost of living. More than 3,000 employers have now accredited with the Living Wage Foundation since the start of the pandemic. 

Metro Mayors in London and Greater Manchester have also announced major new commitments to create Living Wage City Regions, which could see thousands more pay rises.  

Looking globally, the Living Wage campaign also launches Living Wage for US, the first coordinated national effort set up to ensure that workers across the United States are paid a real Living Wage. 
 
Low pay in the UK  
The announcement of the new rates comes as new research by the Living Wage Foundation has demonstrated the scale of low pay during the pandemic, with 4.8 million jobs (17.1% of employee jobs) still paying less than the real Living Wage. 

Those from racialised groups were more likely to be low paid – with 19.4% of these workers earning below the LW compared to 16.3% of white workers.  
 
Katherine Chapman, Living Wage Foundation Director, said: 

“With living costs rising so rapidly, today’s new Living Wage rates will provide hundreds of thousands of workers and their families with greater security and stability.  For the past 20 years the Living Wage movement has shaped the debate on low pay, showing what is possible when responsible employers step up and provide a wage that delivers dignity. Despite this, there are still millions trapped in working poverty, struggling to keep their heads above water – and these are people working in jobs that kept society going during the pandemic like social care workers and cleaners. We know that the Living Wage is good for businesses as well as workers, and as we rebuild our economy post pandemic, the real Living Wage must be at its heart.” 

Kim Coles, Finance Director at Lush, said: 

"At Lush we are committed to a fair wage at all levels of the business and fully support the UK Living Wage Foundation's approach of a hard day's work deserving a fair day's pay. We have been paying the London Living Wage since 2011 and paying all UK staff at or above the "real" hourly Living Wage rate since April 2017. We continue to commit to the rate in tough times because that is when our people need it the most, and it's the right thing to do. Lush staff are crucial to our success, and they work incredibly hard making and selling our products. Having an independently calculated real living wage rate means that we have a positive step towards staff being able to afford what they need to thrive, not just survive. It also means that the same fair-trade commitment we make to our ingredient suppliers is made to our staff and that we can be confident their rates of pay are fair and increase in line with real living costs."   

Ryan, a Living Wage worker at COOK Food, said:

“Before joining COOK I’d worked in a pub for two years. I was on minimum wage and I was working at least 50 hours a week to pay the rent. Even though I was working so hard, I started to get in debt. My relationships suffered, and it started to affect my health, both mentally and physically.  However, since coming to COOK, being paid the real Living Wage made all the difference. I could work only 40 hours a week and take home more than when I was working 50 or 60 hours at the pub. Gradually my mental health improved, and I also started to live more healthily. I lost 30kg because I actually had the time and money to make real food, eat properly and exercise. My relationships improved as I had time to spend with my friends and made new friends at COOK, too.”