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".

How does APR work? – Your questions answered

APR stands for Annual Percentage Rate and is a standard measure that allows you to compare the total cost of credit from different lenders.

Published on 30 Aug 2019 by Andrew Brown

Full Article

Check your Multi Agency Credit Report before the PPI deadline

The PPI deadline is at 11.59pm on Thursday 29 August. After this point, you can no longer submit applications to reclaim any PPI you are owed from lenders. If you’ve not done it, the time is now to check whether you are owed money. If you start your PPI application before the deadline, it’s still possible to reclaim what you’re owed.

Published on 28 Aug 2019 by Andrew Brown

Full Article

How interest rates are calculated

If you’ve ever applied for a form of credit, you may well have discovered to your cost that the advertised APR and the interest rate you’re offered if you are accepted can be very different things.

Published on 14 Jun 2019 by Richard Catlin

Full Article

The Importance of Proving Stability to Lenders

In addition to the key roles that your Credit History and Affordability play in determining whether or not you will be accepted for credit, we regularly talk about the importance of being able to demonstrate your ‘stability’ to potential lenders.

Published on 15 Mar 2019 by Sophie Regester

Full Article

If I Change My Name Can I Still Get Credit?

Legally changing your name is an increasingly popular thing to do in the UK: while getting married or divorced still makes up a large proportion of this, there is a growing trend towards people changing their name following civil partnerships, a change in gender, living in blended families, or simply because they’re seeking a change – the list is long.

Published on 22 Feb 2019 by Tom Magor

Full Article

Which Credit Report Information Can Landlords See

These days whenever you rent a property you may be required to pass checks set by the landlord or letting agent to prove that you will be a good tenant and that you’ll be able to reliably make rent payments to the property on time.

Published on 7 Feb 2019 by Kevin Pearce

Full Article

What Credit Checks Look For When You Switch Energy

As we get deeper into Winter, it’s inevitable that millions of consumers across the UK will end up using more energy and spending more on bills due to the colder weather and long stretches of darkness.

Published on 9 Jan 2019 by Jamie Mackenzie Smith

Full Article

Pros and cons of going paperless

Whether you are environmentally motivated or simply to get a discount for moving your billing online, you might find it makes sense to abandon paper for your business, if you haven’t already.

Published on 7 Dec 2018 by Kevin Pearce

Full Article

How To Get The Best Car Finance Deals

New car sales may have slowed in recent years, with the economy, emissions scandals and Millennials all being cited as the root cause at one point or another. But the number of people choosing to use credit as a means of driving away in a new car continues to rise, according to figures from the Finance & Leasing Association which shows that the new car finance market grew by 15% in July 2018 when compared to the previous year.

Published on 8 Oct 2018 by Kiah Phillips

Full Article

We're Now More Likely To Be Borrowers Than Savers

UK Households are now more likely to be borrowers than savers, with savings at their lowest since 1963, according to a study by the Office for National Statistics. Households are increasingly borrowing more – by taking out loans, car finance, and mortgages – than they are collectively depositing into savings accounts.

Published on 5 Oct 2018 by Sam Griffin

Full Article
keyboard_arrow_left

keyboard_arrow_right

We are rated number 1 for customer service on