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Low Pay

Poverty focus is an annual publication from Social Justice Ireland where we focus on the nature and experience of poverty in Ireland. Drawing on the available statistical evidence, we outline how poverty is measured, the value of the poverty line and consider many of the groups in our society who are most exposed to living life below the poverty line.

The latest CSO figures show that 122,800 Irish workers earn the minimum wage or less, far below what is required for a socially acceptable standard of living in Ireland. While Social Justice Ireland welcomes the fall in the proportion of employees earning the minimum wage or lower, it still should be noted that the minimum wage remains about 18 per cent below the Living Wage.

Last week, the CSO published the Live Register data, showing 513,350 people in receipt of some form of welfare support.  An estimated 492,000 workers in Ireland may lose thier jobs due to the COVID-19 pandemic alone.  Approximately one in five of all employed.  The worst affected sectors are retail, hospitality, recreation, non-essential manufacturing and construction sectors.  Many of these jobs are defined by instances of low-pay and precarity.  Short-term income supports are welcome as we get through this crisis, however long-term measures are required to sustain these sectors.

Irish workers experience one of the highest proportions of low pay in the OECD. Ireland's rate is more than 5 times higher than that of Belgium, the best performer, and only the United States has a worse instance of low paid employment.

Ireland's low unemployment rates and impressive jobs creation numbers are being recorded in the context of a far lower participation rate than Ireland has had in the recent past. In addition we face challenges in relation to precarious work and low paid employment.  Read Social Justice Ireland's Election Briefing on Work for an outline of a number of key challenges and some policy proposals that should be in the next Programme for Government.

Brexit has the potential to even further reduce the living standards of Ireland's most vulenerable. A sudden increase in food prices will hit lower income households hardest. Here's why.

Low pay is a big problem for Irish society. As we have continuously pointed out,  that that more than 100,000 people in Ireland who have a paid job are living in poverty. These are the “working poor”. The best way to ensure that people working full-time can earn enough to afford a decent standard of living is to move the Minimum Wage closer to the Living Wage.

While we welcome the fall in the proportion of employees earning the minimum wage or lower, the fact is that despite very welcome increases in the NMW in the last few years, it remains about 18 per cent below the living wage. It is long past time that government set a five-year timeframe to close the gap between the National Minimum Wage and the living wage, and implement a system of Refundable Tax Credits in Budget 2020 to help mitigate the issue of in-work poverty.

As long as the National Minimum Wage (NMW) lags so far behind the Living Wage, hundreds of thousands of Irish workers will be forced to do without certain essentials so they can make ends meet. Social Justice Ireland would like to see government commit to a timeframe over which the NMW would move towards the rate of the Living Wage.

Specific interventions are required to tackle the problem of in-work poverty. Until Government makes tax credits refundable, it will not have an efficient mechanism by which it can address the issue of the working poor.

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