What is a Living Wage?

A living wage is not the same as the minimum wage, which is the legal minimum all employers must pay. The living wage sets a higher test - a living wage reflects what earners in a family need to bring home based on the actual costs of living in a specific community. The living wage is a call to private and public sector employers to pay wages to both direct and contract employees that are sufficient to provide the basics to families with children.

The living wage is calculated as the hourly rate at which a household can meet its basic needs, once government transfers have been added to the family's income and deductions have been subtracted. The living wage gets families out of severe financial stress by lifting them out of poverty and providing a basic level of economic security.

 

A living wage:

  • enables working families to have sufficient income to cover reasonable costs
  • promotes social inclusion
  • supports healthy child development principles
  • ensures that families are not under severe financial stress
  • is a conservative, reasonable estimate
  • engenders significant and wide ranging community support
  • is a vehicle for promoting the benefits of social programs such as childcare