Let’s have more work and lower costs to raise living standards – the Living Wage won’t help

In the latest in a long-line of Commissions or studies into the roll-out of a ‘Living Wage’, today the Archbishop of York Dr John Sentamu has called for the introduction of a wage rate of £7.65 per hour (or £8.80 in London) in sectors that ‘could afford it’. In reality this means the public sector and a host of other industries where there aren’t many low paid individuals, such as accountancy, consultancy, banking and construction. Though not as damaging as an economy wide roll-out, if adopted this could still have a host of unintended consequences.

For those who’ve been hibernating in Outer Mongolia for the last few years, the Living Wage is a campaign that presses for a wage rate such that the average household working full time (based on weighting of different types) has an adequate level of earnings for warmth, shelter, a healthy diet and social integration – hence the higher level for London.