Accountants KPMG found that 20% of workers (or nearly 5 million people) do not earn a “living wage”, but what does that mean?
The government sets a National Minimum Wage, currently £6.19 an hour, which companies must pay their staff. As many underpaid workers like myself know, it is almost impossible to pay for rent, food, bills and basic living costs on this wage, even when working full time.
To meet the basic standards of living, it has been estimated that people need to earn £7.20 an hour. This is dubbed the “living wage”, but unfortunately KPMG have shown that many companies prefer to pay the lowest possible amount to their employees.
This makes me angry.
Full time work should provide enough money to live on. Many companies pay the least amount they can get away with, knowing that the government will top up their employees' bank accounts with Working Tax Credits and the like. Many people, including myself, take on a second job in order to make ends meet. This leaves you feeling exhausted and more like a commodity than a valued employee.
Companies argue that they cannot afford to meet the recommended living wage, but from my experience they are shooting themselves in the foot. Paying a higher wage, even an extra 50p an hour, makes a big difference in the employee's psyche. As KPMG themselves have found, paying a living wage increases staff motivation, performance and attendance.
When you work for minimum wage, you find yourself wondering why you put up with all the hassle for such a measly reward. These jobs are usually high-turnover, with staff frequently leaving the company in the lurch for a better offer. Surely the money spent on paying the remaining staff overtime, staffing agency fees, job advertising and training a new employee could be better spent encouraging staff to be loyal to the company in the first place!
If you own a company and respect and value your staff, please pay them a living wage.