A low pay epidemic is sweeping the North East, it is claimed, as new figures reveal one in four are paid below a living wage.
A report released today by KPMG estimates that well over a quarter of a million workers receive less than the £7.65 per hour experts say is needed for the basic cost of living in 2014.
The TUC claim that some businesses can afford to pay the living wage, calculated by Centre for Research in Social Policy, but are refusing to do so – and the regional economy is suffering as a result.
The North East Chamber of Commerce, however, says there has been progress and last week published a survey which shows 35% of firms increased workers’ pay above inflation last year.
Northern TUC Regional Secretary Beth Farhat called for a bigger commitment. She said:
“People deserve a fair day’s pay for an honest day’s work.
“But low pay is blighting the lives of hundreds of thousands of families in the North East. And it’s adding to the deficit because it means more spent on tax credits and less collected in tax.
“We have the wrong kind of recovery with the wrong kind of jobs – we need to create far more living wage jobs, with decent hours and permanent contracts.
“The fact is there are employers out there in our region who can afford to pay living wages, but aren’t.
“It is now time for all responsible employers to commit to adopting this standard, which enables workers to earn just enough to be able to live a decent life.”
Catherine McKinnell, Labour MP for Newcastle North, will speak at the Living Wage Summit at Newcastle’s Centre for Life on Thursday as part of a week of action on low wages by the TUC.
Newcastle City Council became the first to introduce a living wage and the authority boosted this to £7.55 in April, and South Tyneside has announced it is to follow suit. Councils in Gateshead, Northumberland and North Tyneside all set up working groups to explore the issue earlier this year.
Ms McKinnell, Labour’s Shadow Economic Secretary, said:
“People in the North East are really struggling with the cost of living crisis and with around one in four workers in our region paid less than the living wage, more must be done to tackle the problem of low pay.
“Finding ways to support and encourage employers to pay the Living Wage is a major part of that.
“It is fantastic to see more businesses and Labour-run councils in our region seeing the benefits of adopting the Living Wage, but it is important that we continue to demonstrate the value, both to employers but also to our region as a whole.”
The Living Wage Summit will also hear from local authorities, trade unions, voluntary and community agencies, such as the Child Poverty Commission and employers.
Speakers include James Ramsbotham, chief executive of the North East Chamber of Commerce, Sarah Vero from the Living Wage Foundation, Reverend Simon Mason and Matt Stripe, HR director for Nestle, who are a committed Living Wage employer.
Source – Newcastle Evening Chronicle, 03 Nov 2014