British mutual financial institution Nationwide Building Society revealed on Friday that it commissioned a poll, in partnership with Living Wage Foundation, which highlights the difference between the current official UK minimum wage of GBP6.31 per hour and the cost of covering essential bills.
The Living Wage Foundation was formed to recognise and celebrate the leadership shown by Living Wage employers across the UK. Nationwide Building Society has been accredited as Living Wage employer and is now a Principal Partner of the foundation. The 630 employers accredited by the foundation have pledged to pay all employees, from permanent employees to contractors and temporary workers, at least GBP7.65 an hour, or GBP8.80 in London. These rates are calculated according to the basic cost of living in the UK and are set independently and updated annually
According to the Nationwide’s poll, just 9% of working people said they could live reasonably on the current National Minimum Wage, which equates to GBP950 per month or GBP11,321.78 annually. The survey indicated that 16% earn less than the Living Wage, which increased to 22% of those in the lower social grade group (C2DE). The results of the poll have highlighted the need for a higher Living Wage across the UK to help people in work to build their savings, as well as cover the cost of living.
Around half of the respondents to the survey said they would need to earn at least GBP1,100 a month or GBP13,098.62 annually, in order to maintain a reasonable standard of living, which would be equal to someone being paid the Living Wage.
The poll showed that the difference between the Living Wage and the National Minimum Wage of GBP148.07 a month would be most likely to be used by those in the lower social grades to provide basics for themselves and their families, with 51% stating they would spend the difference on food, while 47% would use the money to cover bills and 43% said they would also add to, or start, savings.
In addition, the research showed that 85% of people think that employers should voluntarily pay their employees the Living Wage if they are able to, while 54% said they would be more likely to use the goods and services of a company that paid its employees the Living Wage.
Director of the Living Wage Foundation, Rhys Moore, commented: “We are delighted to welcome Nationwide to the Living Wage movement as both principal partners of the Living Wage Foundation and accredited employers.
“As the UK’s largest building society, this move brings the Living Wage to high streets across the country, and showcases that the best employers are voluntarily signing up to pay the Living Wage now. The Living Wage is a robust calculation that reflects the real cost of living, rewarding a hard day’s work with a fair day’s pay. This poll shows that the benefits of the Living Wage are felt first and foremost at home, with employees better able to afford essentials, from feeding the family to saving for a rainy day.
“The National Minimum Wage provides an effective robust minimum floor for wages and has all but eliminated extremely low pay in the UK. One side effect is that we now see rates of pay at the lower end of the market clustered at or just above the National Minimum Wage. The Living Wage provides a recognised benchmark for employers who are able to pay more.”