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2016 Living Wage rate remains €11.50 per hour
The 2016 Living Wage rate remains €11.50 per hour. This is the average gross salary required by a single individual (without dependents) in full-time employment to afford a socially acceptable minimum standard of living across Ireland.
The Living Wage rate for Ireland is calculated by the VPSJ's Minimum Essential Budget Standards research centre, in conjunction with the Living Wage Technical Group of which Social Justice Ireland is a member, on the basis of the Minimum Essential Standard of Living research.
Elements of a minimum standard of living reduced in cost this year, most notably in the areas of transport and home energy (due to low oil prices). There were also modest reductions in other areas such as food, clothing and household goods. However, with increases in other areas (e.g. insurance) and most notably significant rises in the cost of renting across the country, the overall cost of a socially acceptable minimum standard of living increased this year.
Changes to the taxation system reduced the level of Universal Social Charge (USC) payable by a person earning the Living Wage. This change has lead to a gain in net income for those earning the Living Wage.
The gains from cost savings, in some categories of expenditure, and changes to USC, are wiped out by increasing rents. Rents in Dublin account for almost half (45%) of a single person’s minimum costs. Housing costs (rent) in Dublin increased by 11%, while outside of Dublin housing costs moved up by between 3% and 9%.
Nationally, rising rents were counter balanced by falling energy & transport prices, resulting in the Living Wage rate remaining at €11.50 per hour. It is unlikely that similar cost reductions in oil prices will exert the same downward pressure on the Living Wage next year. Additionally, if the cost of renting continues the trend of recent years, rising costs in 2017 will necessitate an increase in the Living Wage in order to keep pace.