- The National Living Wage, the government's legal minimum, will rise to £12.71 per hour on 1 April 2026 for workers aged 21 and over — but over 16,000 UK employers already go further by paying the higher, voluntary real Living Wage.
- The real Living Wage, set by the Living Wage Foundation, is the only UK wage rate independently calculated based on what people need to live. It currently stands at £13.45 across the UK and £14.80 in London.
- Full-time workers paid the new National Living Wage will still earn over £1,400 less per year than those on the real Living Wage — a shortfall that could cover four months of food for a household or three months of transport costs.
- In London, the gap rises to over £4,000 a year. The difference could pay for over a year’s worth of food or transport costs.
- There are now 4.4 million jobs in the UK paid below the real Living Wage (1 in 7 jobs).
The Living Wage Foundation welcomes the increase in the legal minimum to £12.71 per hour from 1 April 2026, but it will still leave the UK’s lowest paid workers short of what’s needed for a decent standard of living.
Analysis shows that a full-time UK worker on the National Living Wage would need to be paid £1,443 more to bring their income in line with a real Living Wage. That is enough to pay for four months of food or three months of transport costs according to national averages.
With living costs higher in the capital, a London-based worker on the government minimum would need a pay boost of £4,076 to match the London Living Wage, enough to pay for over a year’s worth (13 months) of food or transport costs.
There are currently 4.4 million workers (one in seven) paid below the real Living Wage. [1]
The real Living Wage is the only UK wage rate independently calculated each year to reflect the actual cost of living and cover essentials such as food, rent and bills. It is currently £13.45 across the UK and £14.80 in London. Unlike the government rate which only applies to workers aged 21 and over, the real Living Wage applies to all workers over the age of 18 in recognition that young people face the same costs as everyone else.
The real Living Wage is voluntarily paid by over 16,000 accredited Living Wage Employers - including half of the FTSE 100 and thousands of businesses of all sizes - who choose to do right by their employees by going beyond the legal minimum.
Research by the Living Wage Foundation and Cardiff Business School published earlier this year found that if just half of the UK’s 4.4 million low paid workers saw their pay rise to the real Living Wage, the increase in wages, productivity and spending would deliver £1.6 billion back into the UK economy. [2]
Katherine Chapman, Executive Director of the Living Wage Foundation, said: “The rise to the minimum wage is a welcome boost for low-paid workers who have been hit hardest by years of high prices. It still falls short of the voluntary real Living Wage, the only UK wage rate independently calculated based on the cost of living, currently £13.45 across the UK and £14.80 in London. Despite tough times for businesses over the last year, we are still seeing more employers join the movement of over 16,000 Living Wage Employers who are committed to paying their workers in line with the cost of living. That’s because they know the Living Wage is good for people, good for society and good for business.”
Mike Turner, Founder and Managing Director of highstreet tea retailer Bird & Blend Tea Co., said: “A pay rise for workers on the minimum wage is welcome news, but we believe everyone who works at Bird & Blend should earn a wage that enables them to thrive. That’s why we pay the real Living Wage. Adopting the Real Living Wage has ensured our team can meet the cost of living, even during challenging times. It has also proven to be a valuable investment in our business, helping to reduce staff turnover and strengthen recruitment. This approach has supported our growth into a business with 30 stores across the UK and a team of more than 200 people. By treating people with dignity and respect, and committing to doing business the right way, we’ve created a strong foundation for long term success and a happy, motivated team.”
Brett Mendell, Managing Director of Thomas Kneale, a textile merchant based in Manchester and a Living Wage Employer, said: "The increase to the government minimum will be a welcome boost to the UK’s lowest paid workers, but at Thomas Kneale we believe everyone should be paid enough to thrive, not just survive. That's why we’ve paid the voluntary real Living Wage since 2015.
It's been a good investment for us too. Because our colleagues feel valued, many stay with us for a long time, which reduces costs on recruitment and training. And it means we develop and retain that experience which makes such a difference to productivity and overall quality of work. We've now gone further by providing secure, guaranteed working hours our colleagues can rely on with Living Hours accreditation as well.”
Sam, who works for Living Wage employer Thomas Kneale, said: “My health and well-being really suffered when I worked as a temp on a low-paid zero hours contract. I was stuck in dingey rentals, always falling behind on bills, and cancelling appointments because I couldn’t afford the travel. Now I'm paid a Living Wage and have secure hours at Thomas Kneale all that’s just a distant memory. I'm settled in nice home and pay all my bills by direct debit. I live life on my own terms free of money worries.”