Living wage, not minimum wage

The UK national minimum wage is keeping thousands of UK workers living in poverty and not letting them meet their most basic needs.

As of 1st October 2012 the national minimum wage rose by 1.9% to £6.19 which does not keep in line with the rise of inflation (2.5%, August 2012), so workers on the lowest pay are actually even worse off than they were last year. Someone who works 35 hours a week on the new minimum wage is still only earning £216.65 before tax.

Raising the minimum wage to the level which allows people to escape poverty and meet their most basic needs would help thousands of workers and boost the economy. For several years now a campaign for a compulsory living wage has been gathering momentum, with politicians and other public figures backing the need for a living wage. In London the current living wage is £8.30 but it is is only a recommended level of pay which employers can choose or not choose to give their employees.  Rachel Reeves MP spoke today on the matter at The Labour Party Annual Conference and said,

“The argument for a living wage is moral and economic.

It’s based on the belief that work should bring the dignity of a decent wage, enough to keep a family out of poverty and debt.

And as we’ll hear this morning, it can mean stronger business models, based on better skilled, better motivated, more productive employees.”

Many people opposed to the introduction of an increased minimum wage argue that it would damage the economy and increase unemployment as employers would not be able to pay their current employees or take on additional staff. However, these are the exact same arguments which were brought up against the introduction of the minimum wage in 1998 and the minimum wage reduced unemployment as well as protecting thousands of workers against inhumane levels of pay.

The fact that the NMW is still at a low level and not even in line with inflation and rising living costs means that the gap between rich and poor is forever increasing. The One Society published a briefing note in September 2012 titled, “How National Minimum Wage is falling behind top pay, and the damage this does to living standards and the economy”. In this report it states that,

“If adult-rate NMW had increased, since its introduction, at the same annual rate as the remuneration of FTSE 100 Chief executives, it would have reached £18.89 per hour by 1st April 2012 (three times its actual rate).”

 First Published by First Viewpoint

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Posted on October 4, 2012, in General and tagged , , , . Bookmark the permalink. 2 Comments.

  1. I don’t even know how I ended up here, but I thought this post was good. I don’t know who you are but certainly you are going to a famous blogger if you aren’t already 😉 Cheers!|

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