London Is Failing People With Modest Incomes

Rachel Holdsworth
By Rachel Holdsworth Last edited 49 months ago
London Is Failing People With Modest Incomes

Photo by Tom Frohnhofer from the Londonist Flickr pool

Are you an Endie? No idea what we're talking about? A new report from the Centre for London about Londoners on modest incomes defines an Endie — someone who's employed, but has no disposable income — as individuals or single parents earning between £20k-£33k, and couples with children earning between £25k-£43k, and estimates that 20% of us fall into this category.

Why is this a bigger deal for London than the rest of the country? Well, the report points out, our rents are 50% higher than the rest of the UK. And if you don't already own a home and aren't earning a high salary you have next to no chance of buying, as the capital's prices have risen 68% in the last decade. Also childcare costs have risen faster than elsewhere and transport prices are so high that — in one of those lovely stats that will be quoted for years to come — a zone 4 resident earning £22k pa spends the first 55 minutes of their working day paying for their daily commute.

Centre for London says London is "systematically failing" Endies, who earn too much to qualify for benefits and housing association homes, yet are experiencing stagnating wages (a fall in median incomes of 1.5% when adjusted for CPI inflation over the last 10 years, and bigger declines for those on less than median pay). But we know all this (maybe not the zone 4/55 minutes bit). What we want to know is what Centre for London proposes we do about it.

  • Raising incomes: training shouldn't be focused on young people, as it currently tends to be, though given that a quarter of Londoners in low-skilled jobs already have a degree, education isn't necessarily the solution. Centre for London looks at things like Airbnb to monetise spare rooms or time and, from the government's end, revising the tax system.
  • Reducing costs: encouraging the private sector to take an Aldi-style, low cost, approach to things like energy, waste and transport. And, of course, housing: Centre for London wants the public sector to get involved in building genuinely affordable homes.
  • Social Improvement Districts: a SID is a place for people on modest incomes to live with public leadership to bring together innovations like those described above, to benefit householders. The suggestion is that they'd comprise about 7,000 households — they sound a bit like council estates with more connections between social enterprise, private sector and the community.

Rather than purely relying on statistics, the report's authors have also gone out and spoken to Londoners who fit into the Endie category — and their stories form a crucial component. Their experiences lead to this arresting paragraph:

These people feel a sense of loss that somehow the future they thought was theirs, as well as their past, is being taken from them. Their sense of dismay at having to work so hard to get so little finds expression in a sense of loss and betrayal.

For the over 30s, this sense of betrayal seems to express itself in a disquieting mistrust of immigration and diversity, and all feel resentment towards the monied. Again, from the report: "the social contract on which they have based their lives — work hard, get a decent place to live, start a family — is breaking down". What's being hinted at is a fracturing of society, caused by nothing more than people simply trying to live.

Last Updated 16 September 2014