Third of jobs in Scotland advertised under living wage

The voluntary rate, based on the cost of living, is set by the Living Wage Foundation in November.

Politicians and campaigners said the figures were “shocking” in light of spiralling living costs. They called for a UK Government inquiry into the “rampant” culture of low pay and an increase in minimum wages paid. Workers, including those earning just over the living wage, told The Ferret they were struggling to cover eye-watering rents, increasing food prices, rapidly rising energy bills and unaffordable public transport costs.

Our research was conducted during a two week snapshot period from 17 to 30 January and looked at Scottish jobs advertised at hourly rates. Job ads that did not contain salary information, part-time ads where hourly rates could not be established, term-time only jobs and those advertised as apprenticeships were removed.

The Ferret calculated hourly rates for those jobs given as annual salaries, using the starting salary figure. Where hours were not specified it assumed full-time to be 37.5 hours a week. The research was not able to establish what rate was paid to those hired.

But commentators – who were sent our methodology – said it showed the reality of low pay culture where 40 hour weeks can legally result in pay of as little as £184.80 per week for under-18s. The Ferret found over 40 jobs in this category.

A fifth of jobs were advertised at rates under the national minimum wage of £9.50, set by the UK Government in November and legally enforceable from April.

Almost one in four jobs –19 per cent – on the DWP’s job site were paid at less than the real living wage of £9.90. This rate was set in November 2021 and must be paid by all employers accredited under the real living wage scheme by April this year.

The UK Government stressed that all jobs on its site met legal requirements and claimed the UK had “one of the highest minimum wage rates in Europe”. However MP Chris Stephens, SNP’s Westminster spokesperson on employment, claimed it was the UK Government’s “laissez faire attitude to workers’ rights” that had “allowed this scandal to develop”.

MSP Paul Sweeney, Scottish Labour’s employment spokesperson, said the finding was a “damning indictment of [the DWP’s] callous and cavalier approach to employment”.

In the data set, compiled and analysed by The Ferret, jobs advertised at well under the real living wage included many in hospitality. Burger King advertised jobs at £6 per hour, well under the legally binding minimum wage of £8.91 for those over 23. It means only workers under 18 – for whom the minimum wage is £4.62 – could legally be hired.

Pizza Express was among those paying £6.56 per hour, the minimum wage for 18-20 year olds. Many hotels, including Travelodge, advertised jobs at the minimum wage of £8.91. Supermarket and retail jobs also featured heavily.

The Scottish Retail Consortium said Office of National Statistics (ONS) data showed that average hourly pay in the sector in Scotland was £10 per hour, with retail wage growth rising.

But The Ferret found job listings from McColl’s Retail Group paying £6.56 per hour while Farmfoods supermarket chain was offering jobs paying just £6.66 an hour. Last April Farmfoods announced an 18 per cent increase in profits after a sharp rise in sales. In 2016 chief executive was reportedly paid £425,000.

Iceland – which reported sales increases of 22 per cent in November 2020 – advertised jobs at £9 per hour and Asda, which has also seen sales growth in recent years, at £9.36. Co-op, which prides itself on paying the living wage, is currently advertising jobs at £9.50 but said it expected the rate to be raised in April, the deadline to implement the £9.90 rate. Lidl was also advertising jobs at £9.50 per hour.

Dave Moxham, deputy general secretary of the Scottish Trade Union Congress (STUC), said: “These figures reveal that low pay is rampant across our economy. It is a complete scandal that the UK seems entirely relaxed about which is presumably why it is happy to advertise such jobs on its own website.”

He claimed the real living wage – set in November – was already out-of-date, adding: “With inflation and fuel costs spiralling it is unlikely that the current figure will be enough to keep tens of thousands out of poverty and having to make basic choices between heat and food.”

“The government needs to act urgently to lift the minimum wage to well above £10 per hour and radically improve its pay policy for public service workers,” he said.

Workers in low paid jobs said they regularly ran out of money before pay day. Caitlin Lee, 25, works for bookmaker William Hill, earning £9.10 an hour – a rate recently increased from £8.91 – and is chair of Unite Hospitality’s Glasgow branch.

The recent graduate said: “I speak to a lot of workers who are doing 50-60 hours a week to make enough to live on.

“I’m on a top-up metre [for electricity] and it’s gone from £50 to £100 a month. I’m also having to pay back my student overdraft and I can’t put a dent in it because I don’t have money left over.

“It’s a stressful way to live and it makes the work itself feel demoralising when you’re struggling to get to the end of the month. You feel quite trapped. “At Unite we are increasingly worried for workers about the rising cost of living – there’s a real gap and its quite terrifying. Wages need to rise.”

Another supermarket worker, who asked to remain anonymous, said that though his employer had recently agreed to put up wages from £9.10 to £10 an hour, the rising cost of living meant he was still struggling. ”Even though I’m earning a good wage, I don’t have money at the end of the month,” he added.

“I also have a child who I’m paying [maintenance] for. I don’t have the ability to forward plan – to save for a flat or a holiday. “Yes I can buy food but the only reason I can afford a private rented flat is because I have a partner and we meet the bills jointly. So how can a single person on their own, and not earning the living wage, possibly afford it?”

Eilis O’Keefe previously worked for Cineworld earning £8.30 an hour. Though she is now paid £10.50 per hour for working in admin for the Higher Education sector, she has decided to take on a second job because her living costs have increased more than her wages.

“I’ve ended up in a situation where my rent is £575 for a one-bed flat and takes up 42 per cent of my salary,” she explained. “ I’m doing a 35-hour week with no option for overtime so I’m actually less well off.” On Monday, The Ferret revealed how some Scots face paying more than half their salary on rent as the housing crisis deepens.

“My family don’t have the means to support me, and I’m low on the list for social housing. It’s really bad for my mental health,” O’Keefe added.

Satwat Rehman, of One Parent Families Scotland, said the charity was increasingly supporting “worried sick” single parents relying on food parcels, turning off the heating or using pawnbrokers until pay day. “This research by the Ferret on our low wage economy is both extremely timely and deeply concerning,” she added.

“The fact that [more than] 50 per cent of part-time jobs advertised were under the real living wage of £9.90 is indicative of a culture of low pay which has a significant impact on single parents as most are women who work part-time.

“Employers must be persuaded to pay the real living wage which would provide greater financial stability and [the DWP] posting adverts under real living wage on its website must surely be questioned. Everyone deserves a wage which meets everyday needs.”

Anna Ritchie Allan, director of Close the Gap, also urged action to be taken on part-time work, with low pay in those roles disproportionately affecting women.

Chris Stephens MP, SNP spokesman for fair work and employment, said: “These are quite shocking figures. They suggest once again that it is the UK Government’s laissez faire attitude to the economy and to workers’ rights that has allowed this scandal to develop.

“This is the culture of low pay and less workers’ rights. It’s also alarming to see the DWP website offering low paid jobs that ultimately will need money from the state [to top up benefits]. “Food insecurity is going to explode in the UK. There should be an inquiry and the DWP needs to look very seriously at the jobs that it is advertising.” Scottish Labour MSP Paul Sweeney added: “It simply cannot be right that almost one in three full time jobs advertised do not pay what is determined to be the bare minimum. In my view, the real living wage is not nearly high enough.

“More than ever before we are seeing a growing imbalance of power between employers and employees. It cannot be allowed to continue.

“In addition to an increase in the real living wage, I would urge the DWP and other advertisers to stop promoting low paying jobs with a lack of job security for those seeking employment.”

David Lonsdale, of the Scottish Retail Consortium, warned that it was important to think about the barriers for employers.

“Retailers strongly support the objective of higher wages in the industry and have been working hard in recent years with some success to secure the productivity improvements needed to ensure such increases are sustainable, against an especially tough trading environment over the past two years,” he said.

“However, sustainable increases in pay are made more challenging when firms are having to grapple with an assortment of higher costs. Transport, shipping, and labour costs have all spiked, and commodity prices have risen too.”

A Scottish Government spokesperson said that while employment law is currently reserved, it will “use every opportunity possible to promote fair work and ensure people are paid at least the real living wage”.

“In September 2021, Scottish Government ministers wrote to public sector leaders, including local government, reaffirming their commitment to fair work and asking the public sector to show leadership in adopting fair work practices,” they added.

A UK Government spokesperson claimed that the UK had one of the highest minimum wage rates in Europe, with the national living wage and national minimum wage having increased every year since their introduction. “It will be increased again in April, adding to our targeted support for those most in need and we expect these increases to benefit around two and a half million workers,” they added.

“The UK Government has prioritised making work pay and through our changes to Universal Credit, we should see 1.9 million working families gain an average of approximately £1000 a year.”

The Ferret contacted the companies named in our report. Pizza Express and Coop confirmed that the hourly rates reported were in line with employment law.

An Asda spokesperson said the company was increasing pay by 7 percent over the next two years, with hourly rates due to reach  £10.06 in April 2023. "We pay all store colleagues a bonus, worth several hundred pounds a year on average, as part of a comprehensive benefits package," they added.

Others did not respond to requests for comment.

Priced Out is an investigation by The Ferret, co-published with The Herald, exploring the impact of - and reasons that lie behind – the cost of living crisis in Scotland. Support their journalism by becoming a member for £3 a month. Use discount code PRICEDOUT to get your first month free.