The Living Wage is key if we are to tackle women’s in-work poverty

Living Wage Week is an opportunity to recognise the importance of the Living Wage in tackling women’s poverty and realising fair work for women. Women account for the majority of low-paid workers in Scotland, and two-thirds of workers being paid less than the Living Wage are women. Low pay is a critical factor in the gender pay gap and also reflects the continued undervaluation of “women’s work” in sectors such as social care and childcare.

Women are more likely than men to have caring responsibilities and therefore must find work that allows them to balance earning with caring. This sees women concentrated in part-time work which contributes to women’s higher rates of in-work poverty as most part-time work is found in the lowest paid jobs and sectors. Part-time jobs are more than three times as likely to pay below the Living Wage than full-time roles and research from Living Wage Scotland found that women in part-time work stand to benefit the most from Living Wage accreditation.

This year, Living Wage Week is more important than ever. Evidence highlights that low-paid women have been disproportionately impacted by COVID-19 job disruption. Low-paid women are more likely to work in a shutdown sector, are less likely to be able to work from home, and are more likely to lose their job over the course of the crisis. For women earning less than the Living Wage, receiving only 80% of their usual salary through the Job Retention Scheme is likely to push them into further and deeper poverty.

Many of the sectors where women are concentrated that have been particularly impacted by shut downs and physical distancing measures, such as retail and hospitality, are notoriously low paid and characterised by job insecurity. For example, four in ten of those working in retail and wholesale are paid less than the real Living Wage and 80% of people working in hospitality reported that they were already struggling with their finances before going into lockdown. Women in these low-paid, high-risk sectors were already more likely to be experiencing in-work poverty and are therefore less likely to have savings to fall back on.

In addition, the majority of the key worker jobs identified by the Scottish and UK Governments are undervalued female-dominated occupations including nurses, carers, early learning and childcare workers and supermarket workers. These roles are predominantly done by women, and for this reason many of these jobs are systematically undervalued in the labour market. Research by the Women’s Budget Group’s found that women account for 98% of the workers in high exposure jobs earning ‘poverty wages’.

Women who were already struggling are now under enormous financial pressure, being pushed into further and deeper poverty. Ultimately, without specific interventions to promote women’s equality and a gendered response to the crisis, COVID-19 will exacerbate the gendered nature of poverty in Scotland.

Last week, in response to the impact of COVID-19 on young people’s employment prospects, the Scottish Government launched the Young Person’s Guarantee. Close the Gap has advocated that gender is integrated into the Guarantee, that the barriers young women face in entering the labour market are recognised, and that occupational segregation is proactively challenged. We’ve therefore welcomed the commitment from the Scottish Government that the design of the programme will ensure all groups of young people will benefit from the Guarantee. While employers engaged in the scheme must commit to the payment of the Living Wage over a set period of time, there is no obligation that employers pay young people at this rate from the outset. As the payment of the Living Wage is critical to tackling women’s poverty, particularly for young mothers, it is vital that the Government’s ambitions around the Living Wage are realised by employers engaged in the Guarantee.

The Scottish Government have acknowledged the inextricable links between gender and poverty, and women’s poverty and child poverty in a number of key policy documents including Scotland's gender pay gap action plan, and the child poverty delivery plan. These plans are clear that tackling the gender pay gap is essential to overcoming women’s higher rates of in-work poverty, and child poverty in Scotland. In particular, the Child Poverty Delivery Planhas a focus on engaging with sectors such as tourism, retail and hospitality where women’s low pay is a concern. In outlining how these sectors have a critical role to play in tackling child poverty, the plan establishes that the payment of the Living Wage in female-dominated sectors is vital to lifting women and their children out of poverty.

In response to COVID-19, achieving fair work for women by building a labour market and economy that works for women must be core to economic recovery policymaking. Of course, while the payment of the Living Wage in female-dominated jobs and sectors is an important starting point, this also has to be accompanied by a more structural response to the continued economic undervaluation of work done by women.

Prior to the crisis, women were more likely to be experiencing in-work poverty. This trend will only be worsened by the labour market and economic implications of COVID-19. This makes it even more vital that economic recovery policymaking and action to address child poverty prioritises substantive action on women’s low pay. The Living Wage ultimately remains key to tackling women’s in-work poverty.