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In-work poverty in decline

Fall in number of workers earning below living wage

Pay

Wages for lower paid are rising

Fewer Scottish workers are earning less than the real Living Wage, according to new data.

An estimated 380,000 people north of the border currently earn below the threshold of £9, which is 57,000 or 13% fewer than in 2018 (437,000).

The improving picture for the lower paid will be a challenge to Labour which has made the living wage a key policy objective.

The improvement is better than the UK as a whole which saw a decline of 10% earning below the threshold.

Analysis from KPMG and IHS Markit also reveals an improving picture for full-time Scottish female workers, with 11% (77,000) earning below the Living Wage, against 12% (79,000) in 2018.

While the gap is narrowing, the data shows 8% (76,000) of men working full time in Scotland earn below the Living Wage, down from 10% (94,000) in 2018.

The findings do however reveal there is long way to go for part-time workers in Scotland. The data shows 30% (155,000) of female part-time workers continue to earn below the real Living Wage, against 35% (186,000) in 2018, while 40% (63,000) of men working part-time earn below £9.00, down from 44% (72,000) in 2018.

Jenny Stewart, KPMG’s head of infrastructure, government and healthcare in Scotland, commented: “The latest data provides clear evidence that employers have taken a far more proactive stance on addressing in-work poverty and gender imbalance. Real progress is being made, which is welcome news.

“However, the work can’t stop here. There remains a gap between male and female workers in Scotland, and both males and females working in part-time roles continue to suffer proportionally lower rates of pay. “

We know the campaign for a real Living Wage has had a huge impact in tackling in-work poverty

– Katherine Chapman, Living Wage Foundation

KPMG, working in collaboration with the CBI Scotland and Fraser of Allander Institute, produced the Scottish Productivity Index, which identified gender and pay imbalances as a key target.

“The evidence is clear, and the motivation is now there. By improving pay across the board, we can address long-term economic challenges, and create a more sustainable, competitive, and successful economy in Scotland,” said Ms Stewart.

Across the UK, the KPMG analysis also reveals significant progress has been made, with just under one-in-five (19%) of UK jobs currently paying below the threshold of £9 and £10.55 in London, which is down from 22% in 2018. This is the lowest figure for seven years and represents a decrease of around 560,000 jobs paying less than the real Living Wage.

Katherine Chapman, director of the Living Wage Foundation, added: “We know the campaign for a real Living Wage has had a huge impact in tackling in-work poverty.

“Over the last year we’ve seen more and more responsible organisations recognise that a real Living Wage is not only good for workers and their families, but it also makes good business sense.

“However, with over five million workers still paid below the Living Wage – and 24% of women compared to 15% of men –  it’s clear we need to see more employers step up and commit to pay a real Living Wage.”



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