Third of young women will earn less than they need to live on next year, says Resolution Foundation

The findings could mean more young people find themselves 'stranded' in jobs that do not pay enough to live on

Over a third of women in their twenties will earn less than they need to live on next year, according to a study which will dampen the announcement of a rise in the level of the Living Wage.

Research published on 2 November by the Resolution Foundation predicts that in 2016 almost a quarter of the UK workforce will earn less than £8.25 per hour, which experts say is the minimum necessary to meet the cost of living.

For women in their twenties, the figure earning less than the level of pay deemed to befit a living wage will be 36 per cent, according to the think-tank. This compares with 29 per cent for men in the same age group. Middle-aged workers will fare better next year, with 24 per cent of women and just 10 per cent of men in their forties set to earn less than the living wage.

The Resolution Foundation says the figures are of particular concern in the light of its research, published earlier this year, which found job mobility in the UK had declined since the 2008 crash.

Together, the findings could mean more young people, and particularly young women, find themselves “stranded” next year in jobs that do not pay enough to live on.

Adam Corlett, economic analyst at the think-tank, said: “While you’d expect young people to move on to higher wages as they gain experience, the fact that they are moving jobs far less frequently today compared to before the crash is a real cause for concern. This risks holding up their careers and could leave them stranded on low pay.”

The Foundation’s report follows research published over the weekend by KMPG that found almost six million workers are currently paid less than the Living Wage. The figure represents 23 per cent of all employees, up by 1 per cent over the past year.

Both reports are published to coincide with today’s announcement of new increases in the voluntary Living Wage.

The national hourly rate, which is calculated for the Living Wage Foundation by Loughborough University, rises 40p to £8.25. Almost 70,000 staff are expected to benefit from the increase. A new rate for London, currently £9.15 per hour, will be announced by the capital’s Mayor Boris Johnson.

The new voluntary rates mean the national minimum wage of £6.70 per hour would have to rise by almost a quarter to provide a salary sufficient to live on. From next April the national minimum will rise to £7.20 per hour for those over 25.

Meanwhile the Living Wage Foundation has launched an online map detailing businesses that have committed to paying all their staff – including contractors – the voluntary Living Wage.

The Foundation hopes shoppers will use the map, available at livingwagemovement.org, when choosing where to shop. Numbers of accredited “Living Wage employers” have doubled to 2,000 since November 2014, the Foundation said.

Businesses that have recently made commitments to pay the Living Wage include Lloyds Bank and Unilever.

Sarah Vero, director of the Living Wage Foundation, said: “These employers are not waiting for Government to tell them what to do; their actions are helping to end the injustice that is in-work poverty.”

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