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Beyond the bottom line: the role of the living wage in raising living standards

employment , fairness , personal finances



Over the last decade, campaigners have helped to ensure that many people can benefit from a 'living wage', a pay rate designed to ensure workers can take home enough to live on. This project aims to build a sound evidence base around the potential impact of the living wage.

After succesful campaigning by London Citizens, more than 100 organisations in London are now established as living wage employers, covering over 10,000 workers. In May 2011, Citizens UK launched the Living Wage Foundation, which will provide accreditation of living wage employers across the UK, with a new national, non-London rate also announced. The living wage has also gained widespread support from across the political spectrum and from many business and community leaders.

Despite these successes, the majority of low-paid workers in the UK are not covered by a living wage. At the same time, the concept of a living wage, its possible effects and the route to achieving it remain under-investigated. As the living wage campaign moves into the next phase, targeting major retailers and other organisations reliant on low-wage workers, now is the time to ensure that campaigners and policymakers have the analysis they need to significantly extend the coverage of the living wage across the UK.

Project detail

The key questions we will ask include:

  • What is the potential impact of the living wage on living standards, employment, firm profitability, consumer prices and government expenditure?
  • What are the possible trade-offs between more widespread implementation of the living wage and other priorities, such as full employment, working hours and conditions, and non-pay benefits?
  • Where might responsibility lie for delivering a living wage – across civil society, business, and local and national government – and what strategies should be used for pursuing it?

The research will involve detailed data analysis and modelling, and a final report will be published in autumn 2011.

IPPR is undertaking this research project in collaboration with the Resolution Foundation.