BRIEFING - Calculating the Real Living Wage for London and the rest of the UK: 2024

BRIEFING Calculating the Real Living Wage for London and the rest of the UK: 2024 Nye Cominetti & Louise Murphy October 2024 resolutionfoundation.org @resfoundation Calculating the Real Living Wage for London and the rest of the UK | 2024 2 This report sets out the method through which the Living Wage rates in London and the rest of the UK are calculated by the Resolution Foundation and overseen b. [...] This work is overseen by the Living Wage Commission (from here on ‘the Commission’): the Commission scrutinises the annual calculation and is also responsible for taking decisions over the methodology which underpins the calculation The Resolution Foundation has undertaken the calculation of the LW rates since 2016, when we also reviewed the methodology.1 The core elements of the methodology – the. [...] In the coming year the Commission intends to review the following elements: the translation of the Minimum Income Standard into the Living Wage calculation; the pace of convergence of the actual and underlying Living Wage rates and the role of the ‘shock absorber’; the approach taken to measuring cost differences between London and the rest of the UK; and establishing an appropriate cycle for revi. [...] The rest of this report describes the methodology through which the Living Wage rates in London and the rest of the UK are calculated and the factors influencing changes in the rates this year. [...] In general, the LW rates can be affected by a number of factors: • changes in the prices of goods and services; • changes in the basket of goods and services which constitute the Minimum Income Standard (MIS) (which the LW calculation is based on); • changes to the tax and benefits system (which affects the relationship between pay and income); • the use of the ‘shock absorber’ in years when the u.