Thousands of workers benefit from a rise in the ‘living wage’

Posted by Michael Bolt in Personal Finance on 12 November 2014 - Michael worked as a Credit Analyst at checkmyfile until 2015

The UK ‘living wage’ has increased by 20p to £7.85, a rise which is set to benefit approximately 35,000 workers.

The living wage is a voluntary hourly wage rate based on the amount needed to cover the basic cost of living in the UK and is set on an annual basis by the Living Wage Foundation. It is distinct from the compulsory National Minimum Wage, which is currently set at £6.50 an hour for people over 21 years of age.

Following the recent rise in the living wage, it now stands at some 21% higher than the compulsory national minimum wage. Additionally, the London living wage has also increased to £9.15 an hour from £8.80, representing a 4% increase.

Calculated by the Centre for Research in Social Policy at Loughborough University, the UK living wage is an informal benchmark and does not represent an enforceable pay rate like the minimum wage does. The London living wage, on the other hand, is calculated distinctly by the Greater London Authority. It is designed to provide a relatively basic but decent standard of living for its recipients.

The living wage has now been adopted by a thousand employers across the country including a range of employers from Barclays to Transport for London. It is expected that the increase in the living wage could benefit as many as 35,000 people.

Figures released by Citizens UK, the alliance behind the living wage campaign, shows that the number of employers that pay the living wage rate has doubled in the past year.

Despite the increase in the number of firms paying its employees the living wage, a recent report by the accountancy firm KPMG has found that more than 22% of the working population earn less than the 2013 living wage rate (£7.65 an hour). This equates to some 5.24m workers earning less than the living wage threshold. Younger workers, women and those who work part time were found to be more likely to earn less than the living wage rate, according to the statistics released by KPMG.

The move to increase the living wage has not been welcomed by all, with some business groups having voiced their concerns. The Institute of Directors says that it would rather focus on keeping people in employment, even if it meant lower wages. It has also warned that some employers may struggle to pay it.

Rhys Moore, director of the Living Wage Foundation, says low pay is a strain on the public purse, as "firms that pay the minimum wage are seeing their workers' pay topped up through the benefits system".

Why Don’t Millennials Take Out Credit?

As a millennial, it can feel like my generation is besieged with criticisms on a daily basis, and not all of them are entirely fair (though lots are). We are frequently told that as a generation we are entitled, we have it so much easier than our elders and arguably, worst of all: we buy too many avocados. While I don’t buy avocados, I do have access to credit, which makes me a minority among my age group.

Published on 16 May 2018 by Beth Jennings

Full Article

Why Is My Loan Balance Wrong On My Credit Report?

One of the single most important pieces of information to appear on your credit file is the information relating to your credit agreements and how you repay them - with this information lenders can see your borrowing history across the last six years and use it to help them decide whether or not to offer you finance.

Published on 7 May 2018 by George Coburn

Full Article

How long do closed accounts appear on my credit report?

Some people believe that as soon as a credit agreement is settled and closed, it will no longer be reported to the UK’s Credit Reference Agencies and therefore will no longer have an influence on future credit applications. However, this is a popular misconception, one that could affect your ability to get credit if not correctly understood.

Published on 2 May 2018 by Tom Magor

Full Article

How to Save Big in the Bank Holiday Sales

Bank holidays may not guarantee a day of sun-soaked fun, but as is British tradition, we’d probably be quite happy barbecuing in the snow if it came to it. But no matter what your plans are, if you want to grab a bargain, you can use the Bank Holiday sales to save some serious money.

Published on 26 Apr 2018 by Kiah Phillips

Full Article

Should I Buy or Finance an Aston Martin Valkyrie?

We’ve all been there. £3 million burning a hole in your pocket and a track-going version of Aston Martin’s latest hypercar sat in front of you. But as a shrewd, savvy business-type, you know that dropping £3m in one go on a 1,100bhp car could be considered a questionable, perhaps even ‘baller’ move. But what about putting it on finance?

Published on 13 Apr 2018 by Jamie Mackenzie Smith

Full Article

How to Build Credit History Without a Credit Card

When it comes to the best way to build up a credit history, conventional wisdom is to take out a credit card and use it for everyday purchases, while paying it off (on time) at the end of every month. There’s plenty to support this advice too, as a credit card allows you to spend as much or as little as your limit will allow, while building a history in a reasonably short amount of time.

Published on 26 Mar 2018 by Jamie Mackenzie Smith

Full Article

Which Credit Report Information Can Landlords See

Whenever you rent a property, you will be required to pass some checks set by the landlord or letting agent to prove that you will be a good tenant and that you’ll be able to afford to rent the property.

Published on 19 Mar 2018 by Kevin Pearce

Full Article

Do Student Loans Affect My Ability to Get Credit?

For many people, a student loan is the single largest chunk of borrowing they ever take out, second only to a mortgage. With course fees alone now coming to more than £9,000 per year and then the added maintenance loan on top of it, you can easily end up borrowing £40,000 during your studies.

Published on 8 Mar 2018 by Jamie Mackenzie Smith

Full Article

How Far Back Can I get my Credit History?

For your recent payment history information, your credit file has everything you need; that’s why it’s given so much importance by lenders whenever you apply for credit. But if you’re looking for information that’s six years old or more, it’s probably not be the best place to start.

Published on 7 Mar 2018 by Jamie Mackenzie Smith

Full Article

Are Car Insurance Premiums Calculated Fairly?

Recently news stories have emerged alleging that a “John” might be more likely to get a cheaper car insurance quote than a “Mohammed”, and that someone with a Gmail account could be offered a lower premium than someone with a Hotmail email address.

Published on 12 Feb 2018 by Jamie Mackenzie Smith

Full Article


We have loads of great customer reviews