Tagged: Living Wage week

North East is suffering a pay fall as wage gap emerges

A widening pay gap between the region and the rest of the country has emerged, alongside a pay fall for the nation as a whole this year.

According to the Northern think tank, IPPR North, real wages have fallen in the past few years in the North-East and North Yorkshire, where workers are generally earning less than the national average.

Between 2009 and 2013 real annual wages have fallen three per cent in the North-East (£740) and five per cent in Yorkshire and the Humber (£1,249.)

Over the same period, the cost of living has risen sharply across the nation.

Social research charity, the Joseph Rowntree Foundation (JRF) say the cost of goods and services has gone up 28 per cent since 2008.

Luke Raikes, a researcher with IPPR North said:

“Low pay is a severe and growing problem for both the North East and for Yorkshire and the Humber, as it is for the country as a whole.”

“Workers in the area earn less per hour: nationally the average wage is £13.13, but in North East it’s £12.14, and in Yorkshire and the Humber it’s £12.”

The news has come during Living Wage week, where it was revealed one in every four workers is earning less than the living wage in the region, which now stands at £7.85 an hour.

Most of the districts with the lowest average hourly gross pay were in rural North Yorkshire, which included the districts of Ryedale (£10.43) followed by Scarborough (£10.82) and Hambleton (£11.17).

In the North-East, the average hourly pay in Middlesbrough was the lowest, at £11.05 per hour and the highest was in Stockton-on-Tees, where it worked out at £13.29 per hour.

It comes as a report show a national pay fall. Wages have been “dragged down” this year because of changing trends in the workforce, including younger and less experienced employees, according to a new study.

> But surely changing trends in the workforce are caused by decisions made by  employers ?  If anyone is guilty of dragging down wages, its surely not the employees !

The Resolution Foundation think tank said a downward shift in the mix of occupations towards lower-paying jobs has prevented 2014 from being the year of the pay rise.

But some of this was due to increase employment; changes which led to reduced earnings growth include fewer managerial jobs, rising youth employment and increasing numbers of people starting a job.

> Or, as a comment to the original article pointed out :

It also appears to be due to a cultural change in companies pushing their luck with employees. They know there are less skilled jobs available allowing them to cut wages, implement pay freezes and cut benefits such as pensions. This is definitely the case with my employer. I cant see this changing in a hurry. My employers regularly state if you don’t like it, you know where the door is! Inflation continues, my wage increase doesn’t.

Source –  Northern Echo,  08 Nov 2014