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30 September 2019

Transfer: everything you always wanted to know about the living wage

In July 2019, Ursula von der Leyen, candidate for the European Commission President declared in her ‘Agenda for Europe’: “The dignity of work is sacred. Within the first 100 days of my mandate, I will propose a legal instrument to ensure that every worker in our Union has a fair minimum wage. This should allow for a decent living wherever they work.”

The issue of fair minimum wages is slowly but steadily finding its way to the European Union level. In November 2017, at the proclamation of the European Pillar of Social Rights, the right of workers “to fair wages that provide for a decent living standard” was mentioned for the first time. While the concepts of minimum wage and living wage have often been used synonymously, during the period of neoliberal hegemony their meanings diverged, with ‘living wage’ referring to a wage that is above the minimum subsistence level and which enables workers and their families to sustain a decent living standard.  

The latest issue of Transfer is devoted to this topic. The editors, ETUI senior researcher Torsten Müller and Thorsten Schulten from the German Institute of Economic and Social Research (WSI), argue that given the persistently high levels of in-work poverty and social inequality across the EU it is necessary to merge the two concepts. A wage which allows you to lead a decent life and participate in social and cultural life generates economic growth and strengthens social cohesion. In this regard it is promising that an increasing number of national governments, along with the European institutions, have cautiously started to approach the idea of a living wage.  

This special issue of Transfer provides a clearer idea of the concept of a living wage (there is so far no common definition), as well as an overview of different national initiatives in EU Member States to establish living wages. It also provides some conclusions on the lessons that can be drawn from these initiatives in order to develop a European approach.

The introduction and this overview can be downloaded for free until end of October, along with, we are pleased to announce, two extra articles. The first contribution offers an insider’s account of the review process of the calculation method of the living wage in London and at the national level in the UK. The other article analyses the Nordic approach to a living wage based on the very specific conditions of a centralised and well-coordinated collective bargaining model and a still generous welfare state.

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