With the cost of living crisis likely to continue, millions of people - including those in paid employment - will be pulled into hardship. Jake Shepherd highlights the pivotal position of employers in helping to tackle working poverty, and says a new business standard could encourage them to do more.
The cost of living crisis has been in the political spotlight – and at the forefront of families’ financial concerns – for much of 2022. With inflation not expected to fall until later in the new year, it’s an issue unlikely to go away anytime soon.
The scale of the crisis means that even those in paid employment are being dragged into hardship. Analysis by the Legatum Institute shows that rising costs will result in 2.75 million more people in the UK falling into poverty in 2022/23 – a projected total of 16.65 million – including over a million people from working families. Londoners are likely to be impacted most, as they live in the region most affected by poverty and high living costs.
A societal challenge this great requires a proportionate response. Support should be delivered primarily by government and national policymaking. But employers also have a role to play, as they have a direct influence over the factors that cause or deepen poverty. Whether it be the wages they pay, the number of working hours they provide, or the workplace benefits offered, there are a wide number of measures employers can take to help their staff.
Our research shows employees want, and need, their employers to do more to help tackle London’s in-work poverty problem. But incentives have to be put in place for employers to come to terms with their pivotal position and shift towards a culture of employment that improves the wellbeing of workers.
To this end the SMF is working with Trust for London to establish a new business standard, one that encourages London employers to do more to help tackle working poverty. The design of our benchmark is well underway – we hope to unveil it in 2023 and help deliver real change for people in poverty.
You can read the latest research from the SMF as part of this project here. The SMF also welcomes the ideas and observations of businesses, relevant civil society groups, academics, practitioners, and others on this research, the wider project, and its objectives. To be part of the conversation, email director@smf.co.uk.
This post originally appeared as part of Trust for London’s ‘What does 2023 hold for…’ blog series, and can be read there too.