Living Wage

The Living Wage for 2023/24 is €14.80 per hour. This is a 6.9% (€0.95) change from the 2022/23 rate of €13.85 per hour. This is the minimum rate required for a full-time worker (without dependents) to afford the goods and services that people have agreed are essential for enabling a life with dignity.

The Irish Living Wage rate is calculated on the basis of the Minimum Essential Standard of Living (MESL) research, and set by the Living Wage Technical Group. It reflects the real costs faced by employees in Ireland. The change to the annual Living Wage rate is determined by changes in living costs and income taxes.

Over the past year living costs have increased for most areas of expenditure included in the calculation. Within this, rising energy costs (+23%) and food costs (+21%) added €23 to the price of the average weekly basket. This significant pressure fuelled two-thirds of the required increase in the Living Wage rate.

Other areas of weekly expenditure which also grew notably include Personal Care (+9.2%), Social Inclusion (+6.3%), and Clothing (+5.9%). While Transport related costs decreased slightly (-2.0%).

Rent increases continue to be a significant factor pushing up the Living Wage rate, and increased by an average of 7.0% (almost €13 per week). The new Rent Tax Credit has limited the impact of rising rents on the Living Wage rate required. Without the Rent Tax Credit the hourly rate would have risen by a further €0.35 to €15.15.

Adjustments to tax credits, the €75 increase to the PAYE and single person credit and the introduction of the rent tax credit, have reduced the tax liability on the full-time living wage salary by €12.50 per week. This has limited the required increase in the Living Wage (6.9%) rate this year to below the rate of increase in minimum living costs (8.6%).

The Living Wage rate is based on the rationale that full-time employment will at least provide for a socially acceptable minimum standard of living for a single person without dependents. It represents the minimum required to meet physical, social and psychological needs, and enable a life with dignity.

This differs from the Government’s Living Wage which adopts a fixed threshold approach as opposed to the “basket of good” approach used by the LWTG. The Government’s living wage will be set at 60% of the median wage by 2026, which in 2024 is estimated to be €13.80 per hour.
A Living Wage is intended to establish an hourly wage rate that should provide employees with sufficient income to achieve an agreed acceptable minimum standard of living. In that sense it is an income floor; representing a figure which allows employees afford the essentials of life. Earnings below the Living Wage suggest employees are forced to do without certain essentials so they can make ends-meet.

Further details on the Living Wage and on the methodology used to calculate the hourly Living Wage rate can be found on www.livingwage.ie