Monday 16 July 2018

Soaring rent prices push 'living wage' up to €11.90 an hour

Stock image
Stock image

Anne-Marie Walsh

Soaring rents have pushed the hourly wage needed to survive to €2.35 above the national minimum wage.

An independent group backed by unions, social justice bodies and a UCD department has pegged a new 'living wage' rate at €11.90 an hour.

This is €2.35 higher than the statutory minimum wage of €9.55, which is paid to an estimated 155,000 workers.

It is also higher than the €10.50 an hour minimum wage rate promised by the Fine Gael coalition in its Programme for Government that has not been delivered.

The Living Wage Technical Group reported that rent has risen by over €21 a week in Dublin since last year.

It also revealed that rent now makes up half of a worker's basic living costs in the capital.

Dr Micheál Collins: housing cost overshadowing everything else
Dr Micheál Collins: housing cost overshadowing everything else

Overall, it said the cost of a "social acceptable" minimum standard of living rose by 2.5pc for a single full-time worker without children in the last year.

The wage rate is based on the costs of a worker who is renting and uses a Leap card to get around in urban areas, and a second-hand car like a Nissan Micra in rural areas.

After they have paid for all their necessities, they would be left with a surplus income of just €11.50 a week, or €600 a year.

Dr Micheál Collins of UCD's School of Social Policy, a member of the living wage group, said the wage rate reflects how much a single worker needs to earn to have a basic, but reasonable, standard of living.

He said rents are the driving force in pushing up the rate as the cost of other necessities is falling. In addition, changes to the Universal Social Charge have increased low paid workers' wages after tax.

However, the cost of electricity and gas has risen by over 5pc.

"Food, clothing, transport and health insurance are getting cheaper, but are being overshadowed by increased housing costs," he said.

He said the cost of mortgages are not included in the calculation as workers on the living wage could not afford them.

The living wage group was formed in 2014 and sets rates, but does not lobby for increases.

It is backed by bodies including the Nevin Economic Research Institute, Siptu, and Social Justice Ireland.

Employers are under no obligation to pay the living wage but some previously rolled it out, including Ikea and Aldi.

Irish Independent

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