London is a world city with the highest number of top earners in the UK, but also with the highest child poverty rate in the country. Not surprisingly, poverty is closely linked to low pay. The National Minimum Wage for an adult worker (over the age of 22) is currently £5.73 per hour, dropping to £4.77 for 18-21 year olds and £3.53 for 16 and 17 year olds. According to the 2007 report from GLA Economics (A Fairer London: The Living Wage in London) anyone paid less than about £6.25 an hour will be on the threshold of poverty, even after benefits and tax credits are taken into account.
However, this provides no margin to meet the kind of day-to-day challenges those of us who are better off can afford to shrug off. Therefore, a margin of 15 per cent was added to the poverty threshold wage, bringing the London Living Wage of £7.20 per hour. This has since been raised to a current rate of £7.45 per hour.
If we assumed that the same logic applies to the wages of under 18 year olds the London figure would be something like £4.60 per hour and £6.20 for 18-21 year olds. However, any young people bearing the brunt of their own housing costs the full Living Wage would be more realistic.
Mayor Boris Johnson has continued earlier calls for a citywide acceptance of £7.45 “This is not only morally right but also makes good business sense”. Barclays have gone further, declaring a £7.75 minimum for cleaning, mailroom, security and catering staff. However, at the time of the original report, about one in seven of London's full-time workers and almost half of our part-time workers are paid at a rate below the Living Wage.
Another report from GLA Economics (Patterns of low pay in London, August 2008) attempts to quantify the impact of both individual and job characteristics on the likelihood of being in one of those low paid jobs in London.
As we would expect, factors such as age, level of qualifications achieved and level of occupation have important influences on the likelihood of being low paid in London. Those working in the wholesale and retail trade and hospitality are also more likely to be low paid. Wage inequality increased in the UK between 1970 and the mid 1990s but has not increased further in London since 2001.
There is some good news. Not surprisingly, the report confirms that acquiring skills to get a “better job” works and concludes that policies to assist individuals to progress in the labour market are vital to tackling low pay in London.
London is a world city with the highest number of top earners in the UK, but also with the highest child poverty rate in the country. Not surprisingly, poverty is closely linked to low pay. The National Minimum Wage for an adult worker (over the age of 22) is currently £5.73 per hour, dropping to £4.77 for 18-21 year olds and £3.53 for 16 and 17 year olds. According to the 2007 report from GLA Economics (A Fairer London: The Living Wage in London) anyone paid less than about £6.25 an hour will be on the threshold of poverty, even after benefits and tax credits are taken into account.
However, this provides no margin to meet the kind of day-to-day challenges those of us who are better off can afford to shrug off. Therefore, a margin of 15 per cent was added to the poverty threshold wage, bringing the London Living Wage of £7.20 per hour. This has since been raised to a current rate of £7.45 per hour.
If we assumed that the same logic applies to the wages of under 18 year olds the London figure would be something like £4.60 per hour and £6.20 for 18-21 year olds. However, any young people bearing the brunt of their own housing costs the full Living Wage would be more realistic.
Mayor Boris Johnson has continued earlier calls for a citywide acceptance of £7.45 “This is not only morally right but also makes good business sense”. Barclays have gone further, declaring a £7.75 minimum for cleaning, mailroom, security and catering staff. However, at the time of the original report, about one in seven of London's full-time workers and almost half of our part-time workers are paid at a rate below the Living Wage.
Another report from GLA Economics (Patterns of low pay in London, August 2008) attempts to quantify the impact of both individual and job characteristics on the likelihood of being in one of those low paid jobs in London.
As we would expect, factors such as age, level of qualifications achieved and level of occupation have important influences on the likelihood of being low paid in London. Those working in the wholesale and retail trade and hospitality are also more likely to be low paid. Wage inequality increased in the UK between 1970 and the mid 1990s but has not increased further in London since 2001.
There is some good news. Not surprisingly, the report confirms that acquiring skills to get a “better job” works and concludes that policies to assist individuals to progress in the labour market are vital to tackling low pay in London.