A new technical paper summarizes the insights from the work of developing a comprehensive dataset of living wages with a worldwide coverage (185 countries). It has been supported by the WageIndicator Foundation, DSM, Kering and Philips.
More than ever, income inequalities and working conditions in the private sector are under scrutiny and represent both a risk and an opportunity. Paying a living wage ensures a basic but decent quality of life, and answer at the same time to many SDGS: no poverty, zero hunger, good health and well-being, quality education, decent work and economic growth, reduced inequalities, etc.
More and more companies are using the living wage to benchmark their own wage practices as well as the ones of their suppliers, to support their sustainability and compensation strategy. This application relies however on good data covering enough countries where the operations and suppliers of companies operate. It is the first database that allows a worldwide benchmark of wages practices covering 185 countries.
In this technical paper, we answer a series of common questions on the use and interpretation of living wage, as well as provide recommendations on its future development at worldwide level. For instance, we analyzed in detail the key drivers of variability of living wage estimates using different data sources, developed at different geographical level and using different definitions. We benchmarked as well the main living wage sources that exist in parallel to this one. We provided recommendations on how to refine its calculation in the future, to better ensure its objective: a basic but decent life.