Resolution Foundation calculates workers need £12 per hour to live without benefits
Hot on the heels of calls for employers to universally pay the Living Wage, the Resolution Foundation has calculated the minimum wage would actually have to rise by about 30% beyond the Living Wage for families to work without needing state top-ups.
It finds the minimum wage would need to be £12 per hour (currently it is £6.50) – or £22,700 per year – for state top-ups not to apply.
Currently, the government spends £30 billion per year bolstering the low pay of millions of workers.
The Resolution Foundation found that even if staff were on the London Living Wage of £9.15 per hour, it would still not allow someone to live without in-work state support.
It also warned that if child tax credits were cut, a family would immediately need 12 years’ worth of pay rises just to stay where they were.
By far the largest culprits in low pay are the supermarkets, and the retail sector in general, where there are 5.2 million low paid workers receiving £11 billion in state support.