The concepts of living wage and living income share a goal of achieving a decent standard of living for households. Living wage refers specifically to the context of hired workers (in factories, on farms, etc.), whereas living income refers to any self-employed income earner, such as farmers.
Living wage
The concept of living wage
What is living wage?
Living wage is about a remuneration received by a worker sufficient for the worker and her or his family to afford a decent standard of living.
What does ‘affording a decent standard of living’ entail?
The remuneration received for a standard work week by a worker is sufficient to cover the cost of a decent standard of living for the worker and her or his family.
What does decency mean in this context?
Elements of a decent standard of living include access to food, water, housing, education, healthcare, transport, clothing, and other essential needs including unexpected events.
A living wage refers to the take home pay or net pay received for a standard work week, excluding overtime, that covers basic subsistence needs of the worker and his or her family. Living wages for workers in global value chains can contribute to lifting entire families and communities out of poverty. Currently, more than 340 million workers and their families live on less than US$1.90 per person per day.[1] Human rights to freedom of association, collective bargaining and non-discrimination are key drivers in supporting the provision of a living wage. A living wage is a key driver in fuelling the social and economic development needed to reach the United Nation’s Sustainable Development Goals.
- ^ Shift, retrieved October 2019. https://www.shiftproject.org/sdgs/living-wages/
International organisations leading the work on living wages
Global Living Wage Coalition
Provinding living wage benchmarks.
Ethical Trading Initiative
Creating guidance toimplementliving wages in global supply chains.
Living Wage Lab
Experimenting with innovative ways to realize living wages and incomes in the agri-food sector.
WageIndicator Foundation
Sharing information on wages, labour law &careers worldwide.
Rainforest Alliance
Strengthening certification to achieve living wages for agricultural workers.
IDH
Supporting companies to close the living wage and income gap in their supply chains.
Fairtrade International
Contributingto a living wage for plantation workers.
Asia Floor Wage
Realising living wages for garment workers across Asia.
Fair Wear Foundation
Pushing for living wages in global garment supply chains.
Fair Labor Association
Protecting workers right’s and conditions worldwide.
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Living income
The concept of living income
What is living income?
Living income is about households having the ability to afford a decent standard of living.
What does ‘affording a decent standard of living’ entail?
The net annual income of a household is sufficient to cover the cost of a decent standard of living for a typical household in a particular place.
What does decency mean in this context?
Elements of a decent standard of living include access to food, water, housing, education, healthcare, transport, clothing, and other essential needs including unexpected events.
A living income enables farmers to consistently sustain their families, invest in their farms and make farming a possible vocation for the next generation. The income that a household earns can come from multiple sources, e.g. through the sales of farm-grown products, as well off-farm business (seasonal labour). A living income refers to the – often diversified – household income that would be needed for the household to at least afford a minimum decent standard of living. A living income benchmark is derived from calculating the cost of a decent standard of living in a particular place.
Source: ‘The Living Income Concept’Living Income Community of Practice, retrieved October 2020
International organisations leading the work on living income
Living Income Community of Practice
Working towards a decent standard of living for smallholder farmers.
Fairtrade International
Working to make living incomefor farmers a reality.
World Fair Trade Organization
Global community of social enterprises that practice fair trade.
InfoBridge Foundation
Advancing living income and fair price knowledge.
