Supermarket workers who have kept the UK fed through the pandemic deserve a living wage

The sizeable corps of economists and commentators who have been crying “it’s ba-a-ack”, with respect to the poltergeist of persistently high inflation, are moving into told you so territory.

The Consumer Prices Index smashed its way through the (already grim) forecasts, coming in at 5.1 per cent for the year to November, which will inevitably crank up the pressure on the Bank of England to act just as omicron is infecting the economy.

If this creates a nasty headache for the Bank’s Monetary Policy Committee, it delivers a force 10 migraine for the low waged workers at the sharp end, whose pay packets are getting gobbled up.

Take those on the supermarkets’ checkouts, or filling the shelves, or working in their warehouses; people who are once again facing up to a disturbing prospect: they may be risking their lives each day they clock on.

Some of the big grocers responded to the pandemic by offering chunky looking pay rises, often targeted at those on the bottom rung(s) of their wage ladders. Morrisons, for example, pushed pay up to £10 an hour for in-store staff and then avoided a potential strike by members of the Unite union in its distribution centres by agreeing a 5 per cent rise. Lidl pushed its minimum outside London up to £10.10 an hour, with some workers getting an inflation busting 6 per cent. Those in London got less in percentage terms. But they will earn at least £11.30 an hour.

Despite this activity, the sector wide picture isn’t pretty. The Foundation found that two in every five (41 per cent) of supermarket workers aren’t making enough to live on, using data culled from the National Labour Force Survey and the Annual Survey of Hours and Earnings.

The rates – £9.90 outside London, £11.05 within the M25 – are based on what it takes to do that. Some 9,000 employers are voluntarily accredited living wage employers, a status which requires that both workers and contractors are properly rewarded, regardless of age. So you can’t get away with leaving out the cleaners or the kids.

Famous names including Barclays, KPMG, GlaxoSmithKline and National Express are on board. So are 297 retailers, including the likes of Ikea, Burberry and Richer Sounds, along with a bevy of smaller outfits.

However, not a single grocer has signed up, despite the fact that there is clearly value in displaying the “Living Wage Employer” logo. When people have the choice of where to work – much more likely in the tight labour market the UK is experiencing – where do you think they will go?

The Foundation’s conclusions look even darker when it comes to the breakdown of who is currently swimming under wage water.

Surprise, surprise, women are disproportionately affected. Almost half (49 per cent) earn less than the living wage. Exactly half (50 per cent) of disabled workers are in the same boat. Some 44 per cent of black, Asian and minority ethnic workers sail with them.

But, but, but, higher food prices! If you push up wages, you’ll push up prices too! This, in a nutshell, is the argument the Thatcherite/free market right likes to table against the Foundation’s campaign. Except that it doesn’t wash. Lidl, which wouldn’t appear have to do much to earn its badge based on its headline rates, is one of the cheapest of all the supermarkets operating in the UK.

Despite the UK entry and rapid growth of the latter, and its arch rival Aldi, the established players also still post competitive operating margins. The pandemic requires that a degree of caution is exercised when looking at figures but Tesco’s stands at 3.4 per cent. The French giant Carrefour has been consistently lower than that.

The big supermarkets clearly have the headroom to bring their wages into line with the living wage. The fact that they’re not doing so puts the song and dance they all made about their pay rises this year into some sort of perspective as the cost of living surges ever higher, with tax and interest rate rises looming.

Both Tesco and Morrisons have already had to act to avert potential strike action in the run up to Christmas, with both Unite and Usdaw members involved.

Executives at the big grocers have trumpeted the role their businesses have played in “keeping the nation fed” during the pandemic. Their employees have had to take big risks for them to do that and they aren’t being rewarded. The unions, and the Foundation, have a point.