The report by accountancy firm KPMG has found that 90% of bar staff, 85% of waiters and waitresses and 80% of kitchen and catering assistants earn below the Living Wage.
Overall, 5.84 million workers are paid less than the Living Wage, equating to 23% of all employees, an increase of 497,000 workers year-on-year.
Mike Kelly, head of Living Wage at KPMG, said: “The past year has seen some notable achievements, with 2000 employers, including more than a quarter of the FTSE 100 now accredited by the Living Wage Foundation. Awareness of the issue has also increased, with more than 3 out of 4 of the general public in the know about what the Living Wage is. ”
“With the cost of living still high the squeeze on household finances remains acute, meaning that the reality for many is that they are forced to live hand to mouth. The figures released today show that there is still more to be done if we are to eradicate in work poverty.
Part-time workers, females (29%) and young people (72%) are most likely to earn below the Living Wage threshold.
The Government announced the new mandatory Living Wage earlier this year of £7.20 an hour for those over-25, which will come into force in April 2016. However, many campaign groups, including the National Living Wage Foundation, claim the figure is not a true Living Wage.
The Foundation has calculated that the true ‘Living Wage’ based on the cost of living is £7.85 an hour outside of London and £9.15 within London.
Kelly added: “For some time it was easy for businesses to hide behind the argument that increased wages hit their bottom line, but there is ample evidence to suggest the opposite – in the shape of higher retention and higher productivity. It may not be possible for every business, but it is certainly not impossible to explore the feasibility of paying the Living Wage.”