London’s 21st Century Working Poor

London’s 21st Century Working Poor

22 February 2016 by Tim Thorlby

London’s 21st Century Working Poor: One in Five Londoners is on poverty pay. Here’s how the Church can respond.

If you want to understand poverty in London, one of the best - and most readable - sources of evidence is the regular Poverty Profile published by the Trust for London. It’s most recent report (published late 2015) shows how poverty has been changing in some surprising ways.

In some respects, London is doing well. As its economy has been slowly recovering from the financial crash of 2008 the number of people in work has been growing. Unemployment in the capital has almost fallen back to pre-crash levels. The number of households where no-one works is at a 20-year low.

Yet the proportion of London’s 8.7 million people who live in poverty remains stubbornly high at 27 per cent (that’s 2.3 million people).

Why is poverty so high?

The short answer is that many people have been caught in a vicious ‘squeeze’ as the cost of living in London, especially housing, has continued to rise while incomes have failed to keep up.

It means that today, more than half of those living in poverty in London are actually in work. This is new. The number of people experiencing ‘in-work poverty’ is now greater than the number of those who are out of work and in poverty. One in five of all working families in London live in poverty – that is 1.2 million people - and it has been growing rapidly in the last few years.

This growing phenomenon of the ‘working poor’ is very much driven by accelerating housing costs in the capital. But it is also driven by low pay.

Many of those returning to work in the last few years have found themselves in temporary jobs, working part-time or working in lower paid jobs than previously. The number of people in work may be going up, but the ‘quality’ of many of those jobs has been going down. The hourly rate of pay for many workers has also not been keeping pace with the cost of living.

This is why the London Living Wage is so important. Growing out of a community organising campaign by churches, mosques and other groups in London Citizens, the Living Wage is an independently calculated hourly wage which reflects the cost of living in London. It is currently £9.40 per hour in London and is updated each autumn. (There is a separate lower UK Living Wage for employees working outside of London, currently £8.25 per hour). It is a voluntary rate which employers can choose to pay. It is overseen by the Living Wage Foundation and is backed by the Mayor of London, the London Citizens’ alliance and now more than 600 employers in London who have chosen to become ‘Living Wage Employers.’ This number is growing every month.

Trust for London estimates that almost 700,000 jobs in London (18 per cent) pay below the London Living Wage. This number has been increasing every year for the last five years. The problem of low pay is a growing one.

So, if we are interested in tackling poverty in London, we have to address low pay. Low pay is a headline poverty issue in London.

The Living Wage campaign shows the positive role of Christian faith in public life. Churches have made the Living Wage possible. Christian social teaching is a key motivation for the campaign. The Bible is clear that the earth belongs first of all to God – and that its fruits need to be distributed in a way that ensures everyone has dignity and the material as well as spiritual means to flourish.

What is Government doing about low pay?

The Government is raising the statutory Minimum Wage to £7.20 in April 2016 for those who are 25 or over, and will uprate it each year. This will be welcome news to many on low pay but it only goes part of the way to solving the problem. Rather confusingly, this is being called the ‘national living wage,’ although it is not actually calculated in relation to the cost of living (you couldn’t actually live on it) and will be nearly 25 per cent lower than the independently verified London Living Wage. Nevertheless it is an important step in the right direction.

What can churches do about low pay?

Churches should consider becoming ‘Living Wage Employers’ ensuring that their own paid staff are properly paid.

Churches can join London Citizens – the community organising alliance behind the Living Wage Campaign.

Individual church members should ask their employer to consider becoming a ‘Living Wage Employer.’ The Living Wage Foundation offers accreditation to employers and the right to use the Living Wage Employer Mark in publicity.

Any church or employer contracting out services or buying in supplies should ask their suppliers whether they also pay the Living Wage.

You can find more information about the Living Wage and becoming a Living Wage Employer from the Living Wage Foundation.

The Centre for Theology and Community has also published Just Church – a report which explains the theological basis for engaging in community organising in general, and the Living Wage Campaign in particular.

What are we doing about low pay?

At the Centre for Theology & Community (CTC) we are proud to be a Living Wage Employer, and to equip churches to organise with their neighbours against poverty pay.

We are also keen to do more. We believe low pay – and the poor working conditions that often go with it – is a challenge which good businesses can provide a lead on. That is why we are helping to set up a brand new ‘Living Wage’ cleaning company – Clean for Good.

One of the lowest paying sectors in the UK is the cleaning industry. Recent research estimates that 60 per cent of the UK’s cleaners are low paid. Our own research in the City of London found that as thousands of well-paid City workers depart their offices each day, an army of low-paid cleaning staff enter the City to clean those same offices. The differences in their working experiences were stark. Much of the cleaning sector in London has developed a reputation for low pay and poor working conditions.

So, in collaboration with a City of London parish – St Andrew by the Wardrobe – and other Christian backers like CMS, CTC has been working for the last 18 months on an exciting project to develop a new kind of cleaning business.

Clean for Good is a business with a social purpose. It will provide an excellent cleaning service to small and medium-sized organisations across inner London. But it will also do so in a more ethical way, by treating its cleaners well:

We will always pay the London Living Wage (currently £9.40 per hour) or more to all cleaners

We will provide decent working terms and conditions to all cleaners – including paid leave, guaranteed minimum working hours, even a modest pension

We will invest in the training and development of our staff

We will promote the value of cleaning and cleaners

We want to be the best cleaning company in London – providing the best service and experience for our customers, and the best experience for our cleaners. We are raising our final investments and setting up the company and its leadership team. We have a provisional launch date of September 2016.

Join us! You can follow Clean for Good on Twitter and keep in touch by signing up for our new monthly newsletter at our website. If you’d like to help, or you think you might want new cleaners, do get in touch!

Tim Thorlby

Tim Thorlby

Tim is Development Director at the Centre for Theology & Community and a trustee of Capital Mass.

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