Posts Tagged ‘small business’

Calls for businesses to pay ‘living wage’ as poverty rises among the employed

Friday, February 7th, 2014

Businesses are being called upon to pay staff a wage in line with the rising cost of living, as the number of ‘working poor’ increases.

Around 13 million people in the UK are currently classed as in poverty, and last December, for the first time, it was found that more than half of them were in work.

It is currently estimated that a person must earn £8.80 per hour to support themselves in London and £7.65 elsewhere – though the minimum wage for those over 21 is set at only £6.31.

A report by the Living Wage Commission states states UK employment is becoming ‘increasingly unequal’, with 420,000 more people being paid below  ‘living wage’ in the past 12 months.

The report also states that 5.24mn workers – more than a fifth of the workforce – are paid below living wage.

The pressure is on businesses of all sizes to demonstrate their commitment to their employees and to the economic recovery by raising wages to a ‘more realistic’ standard.

However, many businesses are also struggling financially, and their swansea accountants may tell them they can ill afford to raise wages across the board – at least, not without potentially losing clients by demanding higher prices.

There are said to be a number of causes for the rise in the working poor. The Joseph Rowntree Foundation contends that a rise in part-time work and zero-hour contracts have lowered unemployment on paper, but done little to help people out of poverty.

So while there may be more people in work than this time last year, there is little indication that there are significantly more hours being worked.

Additionally, minimum wage has not risen in line with the cost of living nor inflation, resulting in many becoming unable to enjoy the quality of life they are used to.

Julia Unwin, Chief Executive of the Foundation, said: ‘We have a labour market that lacks pay and protection, with jobs offering precious little security and paltry wages that are insufficient to make ends meet.

‘While a recovery may be gathering momentum in the statistics and official forecasts, for those at the bottom, improving pay and prospects remain a mirage.’

Dr John Sentamu, Archbishop of York and chair of the Living Wage Commission, said: ‘The idea of “making work pay” increasingly sounds like an empty slogan to the millions of people who are hard-pressed and working hard and struggling to make a living.’

Economists warn that the proliferation of low-pay, low-skill work is incompatible with the needs of a first world country.