Moving towards a living wage in the UK

By Izabela Delabre, University of Reading

4.9 million people in the UK earn less than the living wage (image credit: By George Hodan, via Wikimedia Commons)

On 18^th October 2014, thousands of people took to the streets of London for a mass demonstration, arguing that “Britain Needs a Pay Rise” (BBC News, 2014). In their 2008 report for the Institute for Public Policy Research, Working out of Poverty, Lawton and Cooke found that, for the first time, more people in work are below the poverty line than those out of work. A report by The Resolution Foundation, Low Pay Britain 2014, states that as many as 1 in 5 workers or 5.2 million people earn less than than £7.70 an hour. Last year, the number of people in low-paid work (defined as less than two thirds of median hourly pay) rose by 250,000.

Wills and Linneker, writing in Transactions of the Institute of British Geographers in 2014, describe a living wage as one that reflects the local cost of living and the real cost of life. It is an instrument of pre-distribution, rather than using the state’s mechanisms to re-distribute wealth as a way of alleviating in-work poverty. Wilkinson and Pickett (2010) argue that Governments would be better advised to minimise the production of inequality to start with, rather than spending billions of pounds in welfare initiatives to ‘mop-up’ after the party.

Wills and Linneker write that in the UK, the living wage campaign has targeted both private and public sector employers, and the campaign is gaining pace. The Greater London Authority (GLA) has applied the living wage across its own supply chain to include the Metropolitan Police Authority, the London Fire Brigade and Transport for London. The Living Wage Foundation has been pivotal in deepening the impact and spreading the demand of the campaign through the participation of a wide coalition of champions, including Trust for London, Save the Children, Queen Mary, University of London, KPMG and Linklaters. Flint et al. (2014), writing in the Journal of Public Health, find significant differences in psychological wellbeing between those who did, and didn’t, work for London Living Wage employers. Recent figures show that the campaign has a long way to go.

Wills and Linneker argue that, “in the context of a Conservative-led coalition government, along with on-going economic malaise and a weak trade union movement, the demand for a living wage probably represents the best route to reducing the extent and impact of in-work poverty, and ultimately, the degree of inequality within the UK” (2014: 187-188). By taking on a geographical perspective, the authors find that the living wage is a spatial intervention, which attempts to set a new moral minimum for wages across a labour market in a particular locality. They highlight how the impact of the living wage at one scale is very different to that experienced at other dimensions, and this shapes the arguments to be used in its defence. The living wage also raises important questions for geographers seeking to understand poverty and its potential solutions, as it can “put the scourge of economic injustice and inequality at the heart of political campaigning at all spatial scales” (2014: 192).

Low paid Britons now number five million, think tank concludes BBC News, September 27