London Living Wage

In 2007, Trust for London invested almost £1m in the Living Wage campaign as part of a four-year Special Initiative. That investment generated £100m social impact of pay increases for people on low incomes and led to the creation of the Living Wage Foundation. In 2021, as the movement enters its 20th anniversary following its humble beginnings in east London, we are committing an additional £4.8m over the next four years to make London a Living Wage City.

What is the London Living Wage?

2021 Living Wage rates

There are some important differences between the government’s national living wage and the independently calculated, voluntary Real Living Wage. The national living wage is a rebrand of the National Minimum Wage, and is £8.91 per hour (as of November 2021) across the whole country. It’s a minimum by law that all employers have to pay to employees over 25 years of age. There is one rate for the whole country with no allowance for the higher costs of living in the capital.

The Real Living Wage is independently calculated, voluntary and based on the cost of living. The Real Living Wage has different rates for London and the rest of the country, recognising the higher costs of living in London. The London Living Wage rate is £11.05 per hour and the rate for the rest of the UK is £9.90 per hour.

The differences between the two are spelt out below:

Differences between National Living Wage and Real Living Wage 2021

The Living Wage campaign

The Living Wage campaign has already resulted in £1.3bn of increased wages. Around 45% of this is in London, not counting the additional impact created through the Government’s increased minimum wage. But 780,000 jobs in our capital still pay less than the London Living Wage, putting those workers and their families in or at risk of poverty.

The pandemic has been a wake-up call. For the first time, jobs that may have been stigmatised as low skill have been seen for their vital role, including care workers and cleaners. The real Living Wage is paid by over 7,000 UK employers who believe a hard day's work deserves a fair day's pay.

Over the last 20 years, the Living Wage movement has won a pay-rise for over 260,000 workers. At its heart, the real Living Wage is a people-powered movement aiming to end in-work poverty and ensure the cost of living is met by employers, as all workers deserve to live a good quality of life.

3 First funders

Making London a Living Wage City

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We know work is the most important route out of poverty, but more and more poor households in the capital include someone who is working and still struggling. 20.2% of employed London residents were low-paid in 2021- meaning that they earn less than the London Living Wage. We believe that paying a Living Wage is a vital step to lift more Londoners out of poverty and improve their quality of life.

There is an opportunity to create a second step change in the impact of this campaign through ‘Making London a Living Wage City’. This project aims to win a further £635m of increased pay for Londoners, lifting tens of thousands out of working poverty, with an explicit focus on women, young people, migrants and people from Black Asian and Minority Ethnic backgrounds.

The impact will go beyond pay including tackling precarious work through Living Hours and building a powerful and diverse coalition of people and communities affected by the issue. Our funding will boost Citizen UK’s capacity to organise workers and communities; engage and accredit employers to pay the real Living Wage; and further build the profile and support for their biggest campaign.

Equipping communities with the tools to create change is integral to building real power and stronger voices. This will strengthen our democracy and is key to the success of the real Living Wage campaign. Those who started the real Living Wage campaign didn’t want to feel ashamed of low pay but instead learned to build power with the community and win a fair-days’ pay for a fair-days’ work.

Find out more about the history of our work on the Living Wage campaign.

What can I do?

Employers

If you are an employer, make sure you are paying at least the London Living Wage today. Find out more about how you can commit to become a Living Wage employer on the Living Wage Foundation's website.

Individuals

Get involved in your local community. Find out more on Citizens UK's website.

Take a look at our latest low pay indicators from London's Poverty Profile