What is the real cost of living?

What is the real cost of living?

They say the best things in life are free, but if you’re anything like us, you’ve got bills to pay, groceries to stock up on, and a roof to keep over your head. Cash rules everything around us, now more than ever, and for some, this can mean barely making it from pay check to pay check. 

On our Instagram this week, we asked you what you thought about the real cost of living, and how that compares to the average rate of pay country by country. You raised some fabulous points and really got us thinking about how certain sectors pay their employees, the ways that wages and costs of living are calculated globally, and how the COVID-19 pandemic has ignited the conversation around “essential” workers — the majority (if not all) of whom are woefully underpaid and undervalued.

From day dot we’ve been super focused on pay, and what truly fair pay looks like. When Lucy and Chris first met Ismail and discussed making that initial batch of dungarees, like all shrewd businesspeople they immediately negotiated. The difference here, is that they negotiated up, not down, knowing that Ismail’s price was already the best it could be! Amazingly, Ismail already paid his team double the minimum wage, but Lucy and Chris felt like improvements could still be made. You can read more about their journey — with a brief insight into the average Indian wage — here.

Back here in the UK, every member of team Yak is paid the Living Wage in accordance with The Living Wage Foundation. We truly believe that people are able to live their best lives when they are valued and appreciated for the contributions they make, regardless of what sector they work in. Giving simple thanks for a job well done isn’t enough; employers have a duty of care to put their money where their mouth is and make sure that their team can keep a roof over their heads, nourish their bodies, and generally do way better than merely surviving. 

In 2020 (the year where anything seems possible!) we’re continuing to shake things up at Lucy & Yak HQ. When the UK went into national lockdown towards the end of March, our wonderful warehouse team moved to reduced hours so that they could socially distance and pick and parcel your orders safely. During this time, we realised something amazing: at no point did their productivity dip from when they were working full-time hours! So, Lucy and Chris got to thinking and decided to put everyone, across the board, on 30 hours per week — but still pay them a Living Wage equal to 37.5 hours’ worth of work. This means that every worker is now paid approximately £11.62 per hour, up from £9.30 per hour! We’re always striving to do business differently, and we hope that bigger brands than us will see that our new model is viable, and consider adopting it for their teams too!

After all, if everyone was paid a true living wage, our global economy would benefit. People would struggle less and find themselves with more to spend, in turn giving businesses more money to properly pay their staff! And who wouldn’t want our “new normal” to look like that? 

It should come as no surprise at all to any of you, that we definitely have so much more to say on the subject of pay. One thing we’ve learned is that lots of you would love to hear more about the different costs of living across India vs the UK, and how rates of pay compare side-by-side. We’re going to be collaborating with our wonderful team in India to bring you the most up to date information on this — so please do watch this space — but in the meantime we’ve compiled a list of handy resources that you might find useful for further reading:

Resources
UK&I
What is the Real Living Wage? — Living Wage Foundation
The True Cost of Living in UK Cities — ABC Finance 
Calculating the minimum wage — GOV.UK
The Living Wage Campaign — Citizens UK
Accredited Living Wage Employers — Living Wage Foundation
Living costs rising faster for UK’s poorest families than richest, Guardian
Are all Companies Paying Employees the Minimum Wage?  Cashfloat

Global
Comparison of worldwide cost of living — WorldData
Cost of Living — Numbeo
What is a Cost of Living Raise? — Patriot
How are minimum wages set? — IZA World of Labor

Canada and the USA
Minimum Wage by Province — RCC
How Does the Current Cost of Living Compare to 20 Years Ago? — Investopedia
Costs of Living in New York — Payscale

Australia
Living and Studying in Australia — Australian Government
Minimum Wages — Fair Work Ombudsman