United Kingdom

Low pay by industry

Key points

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Graph 1: Risks

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Graph 2: Shares

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Graph 3: By age group

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Why this indicator was originally chosen

Low pay is much more prevalent in some industries than in others.  This is important for two reasons.  First, it is only some industries which are open to global competition and most low-paid workers do not work in these industries.  Second, a significant proportion of the low-paid work in the public sector where government obviously has more direct control over their pay levels.

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Definitions and data sources

The first graph shows how the proportion of working-age employees who were paid less than 7 per hour varies by industry sector, with the data shown separately for men and women.

The second graph shows the share of working-age employees paid less than 7 per hour by industrial sector.

The third graph shows the number of employees paid less than 7 per hour by age group and industrial sector.

Of the 21 Standard Industrial Classification (SIC) 2007 industry sectors, some have been combined together for presentations purposes: 'manufacturing and other production' is industry codes A-F; 'private sector services' is codes H plus J-N; and 'community services' is codes R-S.  In addition, in the third graph: 'public sector and community services' is codes O-Q plus 'community services'; and 'retail & wholesale plus hotels & restaurants' is codes G plus I.

A low pay threshold of 7 per hour has been used.  This threshold is roughly two-thirds of UK median hourly earnings and is commonly used as a threshold when analysing low pay.

The data source for all the graphs is the Labour Force Survey and relates to the United Kingdom.  People whose hourly pay rates cannot be calculated from the survey data have been excluded from the analysis.

Overall adequacy of the indicator: medium.  The Labour Force Survey is large, a well-established, quarterly government survey of designed to be representative of the population as a whole but there are some doubts about the reliability of its low pay data.

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External links

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Relevant 2007 Public Service Agreements

None directly relevant.

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The numbers

Graph 1

Industry Men Women Total
Retail & wholesale18% 28% 47%
Hotels & restaurants27% 36% 63%
Manufacturing and other production13% 5% 18%
Private sector services8% 7% 16%
Public sector: admin2% 3% 5%
Public sector: education2% 17% 19%
Public sector: health4% 17% 21%
Community services12% 22% 34%

Graph 2

Retail & wholesale28%
Hotels & restaurants13%
Manufacturing and other production14%
Private sector services15%
Public sector: admin2%
Public sector: education9%
Public sector: health12%
Community services7%

Graph 3

Industry Age group (numbers are in thousands)
16-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59
Manufacturing and other production90K 160K 130K 70K 60K 70K 70K 70K 60K
Retail & wholesale plus Hotels & restaurants500K 550K 310K 170K 170K 170K 180K 160K 150K
Private sector services70K 170K 110K 80K 80K 80K 90K 80K 70K
Public sector & community services160K 290K 190K 140K 160K 200K 210K 160K 130K

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