The research, published today, revealed that 5.28m people in the UK earn less than the Living Wage – a voluntary rate of pay which is based on the recognition that the national minimum wage does not pay enough for people to maintain a decent quality of life.
The occupations with the highest proportion sub-Living Wage earners were all in the hospitality sector – with 90 per cent of bar staff, 85 per cent of waiting staff and 80 per cent of kitchen and catering assistants currently on wages that fall short.
The Living Wage was recently raised to £7.65 an hour nationally and £8.80 an hour in London, in line with the October’s increase in UK minimum wage, which is now £6.50 for people aged 21 and over.
The research found that bar staff are on average paid £6.57, while waiters and waitresses are on £6.70 and kitchen and catering assistants earn £6.89.
The report did note that the relatively low regular pay for serving jobs could reflect a ‘tendency to rely on discretionary tips to top up incomes’, which are not reflected in the ONS data used to compile the report.
Cross-sector findings in the report included the fact that part-time staff are more likely to earn less than the Living Wage than full-time roles (43 per cent compared to 13 per cent), and London has the lowest proportion of workers on less than the Living Wage at 17 per cent.
Women are more likely than men to be earn less than the Living Wage, with one in four women on wages that fall short, compared to just 16 per cent of men.
Additionally, young workers remain the most likely to be underpaid, with 72 per cent of 18-21 year olds in the UK earning less than the Living Wage compared to 15 per cent of 30-39 year olds.
Commenting on the findings, Mike Kelly, head of Living Wage at KPMG, said: “With the cost of living still high the squeeze on household finances remains acute, meaning that the reality for many is that they are forced to live hand to mouth. Inflation may be easing, but unless wages rise we will continue to see huge swathes of people caught between the desire to contribute to society and the inability to afford to do so.
“For some time it was easy for businesses to hide behind the argument that increased wages hit their bottom line, but there is ample evidence to suggest the opposite – in the shape of higher retention and higher productivity.
“It may not be possible for every business, but it is certainly not impossible to explore the feasibility of paying a Living Wage.”