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UK real living wage rise to £12 per hour “a lifeline”

by Kavitha Sivasubramaniam
24/10/2023
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The UK real living wage has risen to £12 per hour, with a new rate of £13.15 effective in London.

According to the Living Wage Foundation which set the rates, the move will provide a “vital cost-of-living pay boost” to the 460,000 employees at the 14,000 organisations that have committed to awarding the higher amounts.

The real living wage is independently calculated taking into account what people need to live on and applies to all workers over the age of 18. This year, it has risen by 10%, equating to hourly increases of £1.10 across the UK and £1.20 in London, which the Foundation says reflects “persistently high costs for low-paid workers”.

Based on its calculations, a full-time employee earning the new rate would receive £2,145 more than they do now and would be £3,081 a year better off than someone on the government’s current national living wage (NLW), increasing to £5,323.50 for a London-based worker.

Katherine Chapman, Living Wage Foundation director, said: “As inflation eases, we cannot forget that low-paid workers remain at the sharp end of the cost-of-living crisis. Low-paid workers continue to struggle with stubbornly high prices because they spend a larger share of their budget on food and energy. These new real living wage rates are a lifeline for the 460,000 workers who will get a pay rise.

“During these tough economic times, it is heartening that record numbers of employers are signing up to join the living wage movement, protecting everyone who works for them – including cleaners – from rising prices and seeing the benefits of a more motivated and engaged workforce. The real living wage has never been more important and we encourage those who can to join the 14,000 living wage employers across the UK that are committed to always pay a wage that covers the cost of living.” 

The Foundation highlighted that record numbers of organisations have pledged to pay the real living wage in the past two years, with one in nine people now employed by an accredited living wage employer. Those paying the real living wage to date include half of the FTSE 100 firms and household names such as Ikea, Aviva, Everton FC and Lush.

More than 100 employers have also committed to implementing living hours, which guarantee a minimum of 16 hours of work a week, as well as providing a month’s notice of shift patterns and a contract that shows hours worked.

Brett Mendell, director at living wage employer Thomas Kneale, said: “People are our biggest asset, and paying the real living wage and above has significant benefit to both our colleagues and to the company. Our team report lower stress and reduced financial anxiety, a higher standard of living, and a lift in morale. We have also seen productivity improvements while delivering a labour turnover reduction of 60% and a staff absence decrease of 75% since we became accredited in 2015. We’re also a living hours accredited employer, so our team also has security of hours along with other benefits.”

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