Living wage in London receives 5.3% increase, benefiting over 140,000 workers

A full-time worker on the London Living Wage will now earn £4,700 extra across the year

More than 140,000 Londoners are set to receive a 5.3% pay rise as the London Living Wage increases to £13.85 an hour. This new rate, which has risen by 70p from £13.15, was announced by the charity Living Wage Foundation, which bases its calculations on the cost of living.

Around 3,500 employers in the capital are currently enrolled in the voluntary scheme. Katherine Chapman, director of the Living Wage Foundation, emphasised the significance of the increase, stating it would "make a massive difference to workers."

In contrast, the Real Living Wage across the rest of the UK has risen by 5% to £12.60. This rate is distinct from the government’s National Living Wage, which mandates a minimum wage of £11.44 per hour for employees aged 21 and over. Notably, a full-time worker earning the London Living Wage will now earn £4,700 more annually compared to someone on the National Living Wage.

This announcement follows research from the foundation, which revealed that nearly 600,000 low-paid workers in London continue to struggle with high living costs. A recent survey indicated that over half of Londoners earning below the London Living Wage have relied on food banks in the past year.

Among the employers supporting the London Living Wage are The Bird & Blend Tea Co, The Oval Cricket Ground, Shakespeare’s Globe, and West Ham FC. Mike Turner, co-founder of Bird & Blend Tea Co, noted, "Introducing the living wage has not only reduced our turnover but improved recruitment too. The blend of treating people fairly and doing business in the right way is our recipe for a successful company and a happy team."

Muniya Barua from the campaign group BusinessLDN acknowledged the challenges posed by the increase, stating, "This above inflation increase in the London Living Wage will prove challenging for firms at a time when they are facing significant cost pressures." However, she highlighted the clear business benefits, adding, "Not only does it help the lowest paid in society but it also boosts retention and recruitment of talent."

London Mayor Sadiq Khan expressed his support for the wage rise, saying, "By raising the salaries of the lowest paid workers in the capital, we can build a better and more prosperous city for all Londoners." Since 2011, more than £1.4 billion in additional wages has been distributed to low-paid employees in London.

What is the London Living Wage?
- A special wage established by the Living Wage Foundation.
- Calculated based on independent assessments of the cost of living.
- Applicable to all workers over 18, reflecting the higher cost of living in the capital.
- Distinct from the government’s National Living Wage, which is the legal minimum for workers over 21.