Huge pay gap in hourly rates between full time and part time workers

Daniel Wilson shutterstock_95849584-1-2-1People working part time are paid a little over half the hourly rate of those working in full-time employment, and the gap between full time and part time rates is wider in London than any area of the country.

Latest figures for earnings from the Office for National Statistics show that the median hourly rate in London is £9.22 if you work part time but £16.16 for those with a full-time job.

A quarter of the jobs in London are part time and many of them are low skilled. That’s 1.24 million jobs, with some people doing more than one to make up full time hours but being paid a fraction of what they might earn as a full time employee.

In London the gap in hourly rates of pay is 43% but in every other region of the country it is 40% of less. In the South West of England part time workers earn an hourly rate of 68% the full time rate, compared to 57% in London.

The median hourly rate for part time work in the capital is just 14p higher than the next nearest region, the South East of England, but £1.20 higher than the lowest paid region, the North East.

Hourly earnings part time regional

The figures are based on a sample of PAYE records and the ONS calculates a median, or mid point, rather than an average, which might be distorted by a small number of very high rates.

People living in Newham have a lower hourly part time rate than any region of the country and are typically being paid less than those living in Newcastle or Sunderland, where the cost of living is lower.

The rate is only a little higher in neighbouring Tower Hamlets and across the capital median hourly rates for part time workers are below the London Living Wage in 15 of the 33 boroughs – Croydon, Merton, Greenwich, Lambeth, Tower Hamlets, Newham, Barking and Dagenham, Hounslow, Ealing, Brent, Camden, Hackney, Haringey, Enfield and Waltham Forest.

Hourly earnings part time map

The Greater London Authority sets the London Living Wage. It is a voluntary rate and promoted by the Mayor, who is trying to get employers to sign up. At the time of the earnings survey in April the London Living Wage was £9.15. It was increased to £9.40 in October.

As previously reported by Urbs, there are three quarters of a million jobs in London paying less than the Living Wage.  Data shows that women are more likley than men to be in low paid work, and nearly half of those working for less than the London Living Wage are under 24.

Source data

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Lowest paid living in Newham as rates remain static across capital

Over 750,000 jobs pay less than the living wage in the capital

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Lowest paid living in Newham as rates remain static across capital

Pay ShaunWilkinson shutterstock_207548536-1-2

Photo: Shaun Wilkinson ┃Shutterstock.com

The lowest paid full time workers in London appear to be living in Newham. Hourly rates of pay for residents of the East London borough are lower than the typical rate for the UK generally at £12.90.

People living in the City of London or the best-paid borough, Westminster, are typically earning in excess of £250 per week more with an hourly rate of pay over £20.

The figures are revealed in the Annual Survey of Hours and Earnings from the Office for National Statistics. They are based upon a sample of PAYE tax records and are considered the most reliable guide to pay rates.

Newham is not the only London borough where the median pay rate is below the rate for the UK generally. In Barking and Dagenham the full time hourly rate is £13.31, that’s 5p per hour below the UK median rate.

In contrast, across the river from Newham, the hourly rate in Greenwich is £3 higher.

Hourly pay full time London map

The median rate in Brent is below £14 per hour. In Enfield, Haringey, Waltham Forest, Hounslow and Ealing it is below £15.

Outside the centre, rates are highest in a pocket of South West London. Kensington and Chelsea, Richmond and Wandsworth have rates above £19 per hour. In Hammersmith and Fulham it is above £18.

The ONS uses a median rate or mid point rather than calculating an average, which would be distorted by a small number of very highly paid people. The rates are before tax and do not include overtime.

Rates of pay in London remain higher than the rest of the country. The London-wide median rate for full time employment is £16.16, £1.44 per hour more than the next nearest region, the South East of England, and £4.15 more than the lowest paid region, Northern Ireland.

Hourly rates full time regional

The median rate across the UK moved very little in the past year, rising by just 1.5% but that is 5 times higher than London where the hourly rate rose by just 5p since 2014.

Source data

See also

Over 750,000 jobs pay less than the living wage in the capital

Paying the rent takes up 72% of income for private tenants

Over 750,000 jobs pay less than the living wage in the capital

Bike work-2Nearly 1 in 5 jobs in London pays less than the living wage and in some areas of the capital between 30 and 40% of work has an hourly rate below the level Londoners need to live on.

The proportion of jobs below living wage has risen from 13% in 2008 to 19% last year, with women affected more than men and under 24s particularly hit.

Data from the Office for National Statistics show that in 2014 more than three quarters of a million jobs in London paid less than the living wage. Part time jobs are affected more than full time employment, 4 times more likely to be below the living wage.

The London Living Wage (LLW) is set by the Greater London Authority. It is a voluntary rate and promoted by the Mayor, who is trying to get employers to sign up. It is currently set at £9.15 per hour. Last year during the period for these job statistics it was £8.80.

The concept of the LLW was introduced in 2008 and followed by an Out of London rate in 2012. From 2008 to 2010 the proportion of jobs in London below the rate was stable at around 13%. In the past 5 years there has been a growth in low pay, low skill jobs but wage stagnation during the economic downturn of 2008/09 has meant that earnings are lagging behind.

Living Wage rate

The data shows that some sectors of the jobs market that are growing fast have a very high proportion of jobs below the living wage – 45% of social care jobs, 55% in retail, 65% in food and accommodation, and 78% of cleaning jobs.

It is not only work for private companies that is paying poorly. 6% of jobs in the public sector also pay below living wage level. That’s 51,000 jobs.

The only legal protection on pay is the National Minimum Wage, currently set at £6.50 per hour for those over 21. In the budget in July the government announced a new legal rate for over 25s, rather confusingly calling it the National Living Wage. This will be introduced in April at £7.20, but it will not get to the current level of the London Living Wage until 2020.

And it will offer no help to those under 24. Nearly half the jobs in this age group pay less than the living wage.

living wage age

Since 2008 the proportion of 18-24s paid below living wage has gone up by 11% and the rate of 25-34s has risen by 7%.

Women are more likely than men to have jobs below living wage – 22% compared to 16% of men.

London’s rate of 19% of all jobs paying below living wage makes it one of the lowest levels in the UK, on a par with the South East of England and Scotland. But it is not a uniform picture across the capital. 5 boroughs, Harrow, Waltham Forest, Enfield, Sutton and Newham, have rates at 30% and above.

Living wage map-2

Harrow has the second highest proportion of jobs that pay below living wage in the UK. Waltham Forest has the 7th rate.

While parts of the capital enjoy a high proportion of jobs paying above the living wage, tens of thousands of Londoners in the outer boroughs will continue to struggle with the cost of living in the city.

Source data

See also

Living Wage helps some but thousands struggling with low pay in London

Paying the rent takes up 72% of income for private tenants

Pay rates underline gap between rich and poor boroughs

25% rise in TfL staff earning more than £100,000

tube speeding pastThe number of staff at TfL paid more than £100,000 has gone up by 25% in the past year. More than 450 people are now earning 6 figures, according to its draft annual report.

This latest rise comes on top of a significant increase in the previous year. That was partly attributed to the massive Crossrail project, but of the 88 people who joined the £100k ranks in 2014/15 only 1 is working for Crossrail.

TfL staff earning over £100,000
2012/13 2013/14 2014/15
TfL 298 326 413
Crossrail project 30 40 41
Total 328 366 454

TfL says that the 413 includes 59 staff who received severance payments of more than £100,000 as part of it “efficiency savings”. There were also 91 staff who clocked up overtime to push their earnings over £100,000. TfL says their overtime was necessary as they are highly specialised engineers and project staff.

According to TfL the payments are a consequence of a massive modernisation programme that is underway to deliver faster and more reliable services. This includes replacing tracks and upgrading stations and signaling.

The boss of TfL, Sir Paul Hendy, saw his basic salary frozen. According to last year’s annual report he earns £331,357. He is eligible for a bonus of up to 50% of salary. This year he has taken £145,000 in bonus, that’s 87% of his entitlement, in line with TfL rate of delivery against its targets.

Source data

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Traffic constant, profits up – a congestion charge story

 

Pay rates underline gap between rich and poor boroughs

cash sterling notesWhat’s the difference between Newham and Kensington and Chelsea? The answer is about £20,000 if you are looking at pay rates of people across the city

Average gross pay (before tax) in Kensington and Chelsea is the highest in London at £45,000. Newham has the lowest average at £26,000, making it the only borough below the national average of £27,000. There’s some consolation for the people of Newham in the fact that the median house price in the borough is £250,000 compared to £1.2m in Kensington. The crime rate is also lower in Newham.

Gross pay map

Barking and Dagenham and Waltham Forest are just above Newham with average pay of £27,000 and £28,000. They are among 14 outer London boroughs from Hounslow and Ealing in the west, Enfield in the north, Havering in the east and Sutton in the south, that have gross average pay below the London average of £33,000.

Kensington and Chelsea tops the average pay stakes by some margin. The nearest rivals are Westminster and Richmond at £40,000. No data was available for the 8,000 residents of the City of London.

The figures are drawn from the Annual Survey of Hours and Earnings done by the Office for National Statistics using data from HMRC.

Source data

See also

Jobs concentrated in just 5 of London’s 33 boroughs

Well-being and wealth – how South West London soars