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Low pay over time

Key points

  • In 2016, the proportion of jobs in London that are low paid fell for the first time since 2009, to 18%.
  • The low pay rate in 2016 is still higher than all years between 2005 and 2014, with the fall in 2016 cancelling out the increase in 2015.
  • There was a fall in the proportion of part-time jobs that are low paid, and no change in the proportion of full-time jobs that are low paid.

Proportion of jobs in London that are low paid

Low pay by time graph 1.png

What does this graph show?

The graph shows the proportion of full-time, part-time and all jobs that are paid below the London Living Wage over time, termed here as "low paid". The overall low pay rate in London fell to 18% in 2016, following a similarly sized increase in 2015. This fall in the low pay rate was driven almost entirely by a decrease in the proportion of part-time jobs that are low paid of around two percentage points. The proportion of full-time jobs that are low paid remains unchanged between 2015 and 2016.

Compared with 2005, there has been a seven percentage point increase in the proportion of jobs in London that are paid below the London Living Wage.

In 2016, 43% of part-time jobs were low paid, a decrease of two percentage points from the previous year. However, a decade earlier in 2006, 30% of part-time jobs were low paid, meaning significant increases over the period.

12% of full-time jobs in London were paid below the London Living Wage. This is almost double the proportion that were low paid in 2006. 79% of employee jobs in London are full-time, meaning what happens to this rate is very important to the overall figures.

The proportion of part-time jobs that are low paid has been increasing for around a decade, although not continuously. The proportion of full-time jobs that are low paid started increasing around 2010 in comparison, around the period real earnings began falling in London. This reflects, among other things, the increasing cost of living in London which is included in the London Living Wage calculation, and falling wages over this period.

The number of low paid jobs in London has fallen very slightly, by around 7,000, in 2016, in contrast to the five years of increases previously. . However, as the number of jobs overall increased, this also contributed to the fall in the low pay rate. At 720,000, however, there are still twice as many low paid jobs as in 2006, a period in which total employment rose by 20%.

Data used

Annual Survey of Hours and Earnings, ONS.

Indicator last updated: 4 November 2016