More than 800,000 supermarket and care workers paid less than real living wage

·3-min read
One in five key workers found it difficult to take time off if unwell. Photo: Getty Images
One in five key workers found it difficult to take time off if unwell. Photo: Getty Images

Thousands of supermarket and care workers are being paid less than the “benchmark for decent living standards", a new report has found.

The Royal Society for Arts, Manufactures and Commerce (RSA) published a study, tracking the finances and well-being of key workers during the pandemic.

It found 803,000 workers – 45% of all supermarket workers and 31% of care workers – are not being paid the 'real living wage', which is £9.50 ($13) per hour across the country and £10.85 in London. This is a wage rate that is voluntarily paid by some 7,000 UK businesses.

On top of this, with the government’s cut to Universal Credit and the rise in national insurance contributions, the pressures on these workers are mounting.

The report said 660,000 key workers are set to lose their £20 per week Universal Credit lifeline later this month.

And it estimates the recently announced increase in national insurance contributions will cost the average full-time care worker an extra £141 per year, a supermarket worker £148 per year, a van driver £164 per year, and a nurse £304 per year.

The report said one in five key workers found it difficult to take time off if unwell, rising to one-in-four care workers and nearly 40% of NHS staff.

And at the height of the pandemic, 65% of key workers were struggling with their mental health, rising to 73% of NHS workers.

The RSA is therefore calling for the government to focus on increasing pay to boost productivity, offset recent tax and benefit changes, and offer more childcare and better mental health support.

Read more: UK national insurance hike: What it means for your finances

It is calling for all key workers to be paid the real living wage, especially in under-unionised private sector roles. 

The policy would cost £455m for the care sector, and leave a typical worker £990 per year better-off pre-tax, rising to £2,200 in the capital. 

It would cost supermarkets £262m a year and leave the typical worker £410 better off.

“Boosting the incomes of the lowest-paid key workers would be good for those employees, good for UK productivity, and good for the workforce as a whole as this would likely raise wages across the board," said Alan Lockey, head of the RSA’s future of work programme.

A report published in January found that almost half (45%) of all workers at UK’s major supermarkets including Tesco (TSCO.L), Sainsbury’s (SBRY.L), Morrisons (MRW.L) and Ocado (OCDO.L) paid their workers less than the real living wage in April 2020.

In April this year, the government increased the national living wage to £8.91 and the age threshold for the rate has been decreased from 25 to 23, which means thousands of young workers will be eligible.

The 2.2% rise is the equivalent of more than £345 a year for a full-time employee.

Watch: How to save money on a low income

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