Low Pay Commission report: Government must go further on wages

Tuesday 27 November 2018

YWT LOGOResponding to today’s Low Pay Commission report on wages, Young Women’s Trust chief executive Dr Carole Easton OBE said:

“The Government should go further than adopting the Low Pay Commission’s recommendations and extend the ‘national living wage’ to all workers. Allowing employers to pay young people lower wages for no other reason than their age, as the Government is doing, is out-and-out discrimination.

“Even with the small wage increases that will come in next April, under-25s will be losing out on £80 a month because their age means they aren’t eligible for the Government’s ‘national living wage’. This is despite many doing the same work and having the same outgoings as colleagues aged 25 and over.

“This leaves many unable to afford the basics. When the bus to work or an hour’s childcare cost more than an hour’s wages, it’s no wonder so many young workers are falling into debt and resorting to food banks.

“For apprentices, the situation is even harder. The minimum wage is £3.70 an hour, rising to £3.90 in April. Almost half of apprentices say they are in debt and the same number have considered dropping out of their apprenticeship early because they struggle financially. Even more worryingly, today’s Low Pay Commission report shows an increase in the number of apprentices being paid less than the legal minimum they are entitled to, especially among the youngest workers.

“The Government needs to take in-work poverty seriously and pay young people a wage they can live on. As a start, this means extending the national living wage to under-25s and significantly increase the apprentice minimum wage.”

Business administration apprentice Caroline, 23, said:

“For my level two apprenticeship, I was paid £3 an hour. I was living with a friend, so my rent was £250 plus council tax and bills. And I brought in £450 a month or something like that. I ended up working on the weekends as well, putting in like 65 hours a week. It made me really stressed.

“I was in my overdraft and a couple of grand in debt by the end of it. I was just trying to get by; it wasn’t anything extravagant. I felt punished for wanting to do a career and do well, whereas if I’d just stayed in a minimum wage job I actually probably would have been fine.”

ENDS

Notes to editor:

  1. Young Women’s Trust supports and represents women aged 16-30 in England and Wales trapped by low or no pay and facing a life of poverty. The charity provides services and runs campaigns to make sure that the talents of young women don't go to waste.
  2. The Low Pay Commission today (27 November 2018) released its annual report on wages, which advises the Government on national minimum wage rates.
  3. Young Women’s Trust is concerned that the Government has not extended the National Living Wage – which is lower than the real living wage – to under-25s, meaning they can be paid less for the same work. The charity released a report on the issue recently, which can be found here: https://www.youngwomenstrust.org/assets/0000/9637/Paid_Less_Worth_Less_Updated_version.pdf
  4. Young Women’s Trust commissioned Populus Data Solutions to conduct a survey of young people. A representative sample of 4,010 18-30 year olds and 1,115 54-72 year olds in England and Wales, with panel services provided by Populus Live, were surveyed between 29 June-16 July 2018. The survey found that:
    1. four in ten young women (40 per cent) say it is a “real struggle” to make their cash last to the end of the month, compared to 29 per cent of young men. This rises to 58 per cent of women aged 25 to 30;
    2. 28 per cent of young women and 21 per cent of young men say that their financial situation has got worse in the last 12 months;
    3. 39 per cent of young women have been offered zero-hours contract, compared to 32 per cent of young men. In 2017 the figure was 33 per cent of young women;
    4. 27 per cent of young women say their level of debt has got worse in the past year and one in four (23 per cent) say they are in debt “all of the time”; and
    5. just five per cent of young women are currently debt free and 37 per cent don’t think they will be debt-free by the age of 40.
  5. Young Women’s Trust commissioned ComRes to interview 508 current or recent apprentices in Great Britain online between 7 and 14 September 2018. Data were weighted by age, gender and apprenticeship level. The survey found that:
    1. almost half (47 per cent) say they are in debt all the time;
    2. 10 per cent of those who completed their apprenticeship in the last two years are out of work and claiming benefits, nine per cent are out of work and not claiming benefits and 18 per cent are working in a sector not related to their apprenticeship;
    3. 60 per cent say it is a real struggle to make their cash last until the end of the month;
    4. 38% say that covering the costs of travel to work presented a financial challenge while doing their apprenticeship;
    5. one in three women (30 per cent) and one in five men (21 per cent) have been forced to borrow money from friends or family to make their cash last to the end of the month (25 per cent total);
    6. one in five apprentices have skipped meals, one in six have gone into their overdraft and one in 10 have gone into arrears on their rent;
    7. three in five (60 per cent) say they have been paid less than non-apprenticeship colleagues despite doing the same tasks; and
    8. 50 per cent say they have considered dropping out of their apprenticeship early because they struggled financially.
  6. Young Women’s Trust commissioned YouGov to carry out a poll of those making employment decisions in 2018. The total sample size was 816 senior HR professionals / people managers. Fieldwork was undertaken between 12th April - 7th May 2018. The survey was carried out online. The figures have been weighted and are representative of the UK business population by size, sector and region. The survey shows that four in five employers (79 per cent) said that young people should be paid the same as older people for the same work. This includes 77 per cent of small- and medium-sized organisations. 
  7. For more information or to speak to a young woman who is affected, please contact Bex Bailey on 07963018281 or bex.bailey@youngwomenstrust.org.

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