London's Poverty Profile has been created by one of the London's largest charitable funders, Trust for London, and the independent think tank, New Policy Institute.
- In 2012 just under 600,000 jobs in London were low paid (paid less than the London Living Wage of £8.55 per hour). In 2007 420,000 jobs were low paid (when the London Living Wage was £7.25 per hour).
- The percentage of jobs paid less than the London Living Wage was around 13% between 2005 and 2010, but by 2012 it reached 17%. This reflects a trend seen across the earnings distribution: the cost of living is growing faster than earnings, so as prices increase more jobs fall below the low pay threshold.
- In 2012 over 40% of part-time jobs were low paid compared with 10% of full-time jobs. A third of them were done by women working part-time while a quarter were done by men working full-time. Jobs in retail, hotels and restaurants accounted for over 50% of all low paid jobs in London.
- Around 40% of employees of Pakistani and Bangladeshi origin in London were low paid, more than twice the rate for White British employees. Half of working 16 to 24 year olds were paid below the London living wage compared with 16% to 18% for all other age groups.
- 22% of jobs located in Outer London were low paid, compared with 12% in Inner London. Over 90% of the low-paid jobs in London were done by people who lived in the capital compared with less than 80% of non-low paid jobs.
- A third of employees living in Newham were paid less than the London living wage. The next highest was Brent at 30%. The lowest was Richmond at 10%.
We measure low pay in this report using the London Living Wage as set by the Greater London Authority. This is an hourly rate of pay that takes into account the costs of living in London and 60% of the median wage. It is designed to provide someone and their family with enough income for essentials and a cushion against unforeseen events.
in 2012 it was £8.55 per hour, up from £6.70 when it was introduced in 2005 (its rise has largely been in-line with national measures of inflation). This compares to the level at £7.45 for the national Living Wage and the national minimum wage at £6.19. The Living Wage differs from the minimum wage as employers are not obliged to pay the former.
The new London Living Wage rate was announced by the Mayor of London on 4 November 2013: it has increased to £8.80 per hour. The graphs on this website currently use the 2012 level as that is the most recent year of data available.
Indicator last updated: 5 November 2013
- Barking and Dagenham
- City of London
- Hammersmith and Fulham
- Kensington and Chelsea
- Kingston upon Thames
- Richmond upon Thames
- Tower Hamlets
- Waltham Forest
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London living wage:
The London living wage is based on a calculated 'poverty threshold wage', but with an additional 15% added to ensure a 'decent' standard of living for the recipient. More on the living wage campaign.
The threshold for low pay used by this website is the London living wage.
A household is considered to be in income poverty (or low income) if its income is less than 60% of median household income. This measure is used by the Government in its child poverty target and is in common usage across the European Union.
In-work tax credits:
Child and Working Tax credits (CTC and WTC)
CTC is a means-tested payment for people with dependent children, whether in or out of work. However, this analysis only uses the part payable to families in-work.
WTC is a means-tested payment for working people on a low income
Adapted from http://www.taxcredits.inlandrevenue.gov.uk
Barking & Dagenham, Barnet, Bromley, Bexley, Brent, Croydon, Ealing, Enfield, Greenwich, Harrow, Havering, Hillingdon, Hounslow, Kingston upon Thames, Merton, Redbridge, Richmond upon Thames, Sutton, Waltham Forest
Camden, Hackney, Hammersmith & Fulham, Haringey, Islington, Kensington & Chelsea, Lambeth, Lewisham, Newham, Southwark, Tower Hamlets, Wandsworth, Westminster