One in five workers on poverty wages: Trust for London

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One in five people working in London is being paid "poverty wages", a charity has claimed.

The study said the number of jobs paying below the so-called "London living wage" had risen by 100,000 to 580,000 between 2010 and 2011.

Last year mayor Boris Johnson raised the recommended minimum hourly wage to £8.30, a rise of 45p.

Trust for London, which funded the study, said the living wage benefited workers, employers and the government.

The anti-poverty charity said the government could save almost £1bn a year if companies paid the wage in London, due to extra taxes and less spending on welfare.

Meanwhile a spokesperson for Mr Johnson said: "The mayor believes strongly that paying the London living wage makes good business sense as it helps to boost the bottom line by building dedicated and motivated workforces."

The research was carried out by Jane Wills, a professor of geography at Queen Mary, University of London.

She said 55% of those interviewed said it was difficult to manage their household expenses.

'Unequal cities'

One said they spent half of their wages on repaying debt, while others said they worked very long hours.

Enhance Office Cleaning introduced the wage in 2010.

Sandy Aird, its managing director, said the company believed it was "morally right" to do so.

He added the company now had a lower staff turnover due to the wage increase.

Bharat Mehta, chief executive of Trust for London, said: "Government can save nearly £1bn a year in London if companies in the capital pay the Living Wage; workers receive thousands more in wages and employers can reap HR, reputational and efficiency benefits.

"This means there is no reason for large numbers of companies to pay poverty wages in the capital.

"Paying the Living Wage gives people fair reward for the work they do and helps to tackle poverty and inequality in one of the most unequal cities in the developed world."

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