More UK workers earning less than living wage as in-work poverty increases

The number of people earning less than the living wage increased to 19% of working people in 2014, from 13% in 2010, the Office for National Statistics (ONS) has said. Despite overall wage rises, this means that in-work poverty has increased.

Numbers from the ONS show that the increase of the relative number of people making less than the living wage, which should cover the basic costs of living, is mostly hurting areas far from the capital, like West Somerset, but there are some constituencies closer to London affected, such as Waltham Forest.

North East Derbyshire, Breckland and West Lancashire are also among the areas that have a high proportion of workers earning below the living wage. Overall, wages edged up by almost 3% in the second quarter of 2015.

By 2016, UK companies have to pay their workers more than £7.20 an hour, while the new living wage will reach £9 in 2020, as announced by Chancellor George Osborne.

Sarah Vero, head of partnerships at the Living Wage Foundation (LWF) said it is disappointing that the proportion of working people earning less than the living wage has increased. "These figures demonstrate that while the economy may be recovering as a whole, there is a real problem with ensuring everyone benefits, and low pay is still prevalent in Britain today. The best employers are not waiting for government to act," she said.

Companies, including Lidl, IKEA and Starbucks, have already announced they are hiking their pay to meet the living wage requirements set by Osborne, while many other major firms said they are preparing for the increase in 2016.

"[About] 1,800 responsible employers already pay the living wage to their staff," Vero said. "The living wage offers great benefits to business, including reduction in turnover and higher productivity, while 70% of consumers say they would prefer to shop with a living wage employer."