4.4 million jobs in the UK are paid below the real living wage (Image: GETTY)
From the beginning of April 2026, National Minimum Wage rates rose, providing workers aged over 21 on the National Living Wage with an additional 50p per hour, while those under 21 received increases of up to 85p per hour in a bid to narrow the gap between different pay rates.
Nevertheless, experts have cautioned that these increases will still leave full-time workers on the National Living Wage approximately £1,400 short of the ‘real’ Living Wage. According to the Living Wage Foundation, this deficit could potentially cover four months’ worth of groceries or three months of transport expenses for a household.
Read more: Ikea has introduced £13.45 rule for UK stores
Read more: Wickes introduces £13 rule in all UK stores in April
The foundation calculates the Real Living Wage, a rate determined by the cost of living. It factors in how much a worker needs to be paid in order to meet essential expenses such as food, rent and utility bills.
In contrast to Minimum Wage rates, it’s entirely voluntary, though more than 16,000 UK employers are already reported to be paying their staff this wage. The foundation also maintains that this rate should apply to all workers aged 18 and above, acknowledging that younger people may face identical living costs to everyone else.
The National Minimum Wage for 18 to 20-year-olds is receiving the largest rise this year at 8.5 percent, bringing it up to £10.85 per hour. Rates for 16 to 17-year-olds and the apprentice rate are climbing to £8 per hour.
Finally, the National Living Wage for employees aged 21 and above is rising by 4.1 percent to £12.71 per hour.
Rachel Reeves unveiled this increase in November, declaring it would enhance earnings for approximately 2.7 million workers “so that those on low incomes are properly rewarded for their hard work”.
At present, the Real Living Wage sits at roughly £13.45 across the UK and £14.80 in London. For those working in the capital on the National Living Wage, this represents a £4,076 shortfall which could potentially cover an entire year’s grocery expenses for a family.
Katherine Chapman, Executive Director of the Living Wage Foundation, commented: “The rise to the minimum wage is a welcome boost for low-paid workers who have been hit hardest by years of high prices.
“It still falls short of the voluntary real Living Wage, the only UK wage rate independently calculated based on the cost of living, currently £13.45 across the UK and £14.80 in London.
“Despite tough times for businesses over the last year, we are still seeing more employers join the movement of over 16,000 Living Wage Employers who are committed to paying their workers in line with the cost of living.
“That’s because they know the Living Wage is good for people, good for society and good for business.”
A study conducted by the Living Wage Foundation and Cardiff Business School, published earlier this year, suggested that should half of the UK’s 4.4 million low-paid workers begin receiving the real Living Wage, the resulting increase in earnings, productivity and consumer spending could generate a £1.6billion uplift to the wider economy.