A new, independently calculated “real living wage” estimates the true cost of living in the UK as almost £2,000 per year more than the government’s national minimum wage allows.
The Living Wage Foundation set the previous rate of £9.50 per hour in November 2020 and has now increased the estimate to £9.90 across the UK — and £11.05 in London — to keep up with the rising cost of living. The group publishes the real living wage each year based on inflation and the cost of fuel, energy, rent and food.
Chancellor Rishi Sunak recently raised the national minimum wage (for 16 to 22-year-olds) and national living wage (for those 23 and over) during his Autumn Budget announcement, with the new rates taking effect from April 2022.
The government’s national living wage will rise from £8.91 per hour to £9.50 in April. Those aged 21 and 22 will get a new minimum wage of £9.18 per hour, 18- to 20-year-olds will be entitled to £6.83 and 16- and 17-year-olds should be paid £4.81 per hour.
Anti-poverty campaigners including Helen Barnard, associate director at the Joseph Rowntree Foundation, highlighted that rising costs of living, including food and energy prices, “massively outweighed” the government’s increase.
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Almost 9,000 employers have committed to paying their workers the real living wage, according to the Living Wage Foundation, including Lush, Fujitsu, Getir grocery delivery service and Cook Food. That means more than 300,000 workers will receive the 40p per hour pay increase.