5 reasons you should become a real living wage employer

17th May 2022

In this April’s budget, Chancellor Rishi Sunak revealed a 6.6% increase to the national living wage, meaning that from April, the minimum hourly rate for those over 23 rose to £9.50 from £8.91.

The government’s national living wage differs from the real living wage, (which the The Living Wage Foundation campaigns for) in a number of ways, but the main difference is the hourly rate of pay for employers in the UK, which is set at £9.50 and £9.90 respectively. The Real Living Wage also applies to anyone aged 18 and over, not just those 25 and over as with the National Living Wage.

Currently, there are 321 accredited Living Wage employers in the South West, including Business West Chamber and Bristol City Council.

Bristol Council has launched the Bristol Living Wage initiative to help businesses understand the advantages of becoming a Real Living Wage employer.

 

Helen Thornton, Economic Inclusion Officer at Bristol City Council said:

“We’ve been working with a strong, core group of employers in the city to drive change and reduce in-work poverty. In 2019, we were formally recognised by the Living Wage Foundation for our efforts to make Bristol a Living Wage City. Bristol was one of the first UK cities to achieve this acknowledgement.

“The group’s aim is to more than double the number of accredited Living Wage employers in Bristol – both large and small – by the end of 2022, ensuring that over 40,000 staff are paid the real Living Wage.”

So, why should your business join them?

1.Staff retention

As an employee, if you feel you are valued and receive a fair wage to do your job then you are more likely to stay. 

High staff turnover is financially damaging to businesses, and it can take time to employee new people.

A prime example of a business who has benefitted is Brewdog. A year after introducing the Living Wage, staff turnover on BrewDog’s retail sites fell by 40%. 

2.Happier employees are more productive

A study by Oxford University’s Business School found that workers are 13% more productive when happy. By paying your employees the Real Living Wage, they are less likely to have financial concerns and can focus more on their projects. 

3.Improve your reputation

In today’s job market, employees are increasingly attracted to work for employers that share their own morals. According to a recent study from California-based management consultancy Blue Beyond Consulting, 80% of US and Canadian workers surveyed stated it was important that company values were consistent with their own.

According to The Living Wage Foundation, 93% of current university students would prefer to work for an accredited Living Wage employer, showing that the future workforce believe in the importance of fair pay. 

4.It can reduce government spending

Workers who are underpaid must rely on benefits to survive leading to lack of availability of government funds to improve our towns, cities, and regions. 

Bristol aims to be the best place to live and work and this can only be achieved through a fair living wage for all.

5.It narrows the gender pay gap

‘She-flation’ is the term for how inflation is having a greater impact on women compared to men due to more women working in low paid roles with more spending commitments. The Living Wage’s recent poll of employee’s earning below the real Living Wage, found that during a period where the cost-of-living is skyrocketing, 42% of low paid women had fallen behind on bills, compared to 35% of low-paid men. 

By becoming an accredited real living wage employer, you are helping to narrow the pay gap. 

With so many clear benefits for businesses in paying the real living wage, why not join the 9000 UK businesses already offering this to their staff and help your employees cope with unprecedented cost increases?

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