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A second approach calculates the threshold wage based on London's income distribution; the threshold is the wage which allows a household to have an income 60% that of the median.
2005 The Living Wage Unit (Greater London Authority) publishes A Fairer London and announces a poverty threshold wage of £5.80 an hour and a living wage of £6.70 in the capital.
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Yet austerity and recession means that the "couple-with-two-kids" would need to earn 46% more than they did in 2008 to reach the MIS threshold (wages have risen by just 9% over that period).
These ideas are also broadly consistent with Maslow's theory that after a certain threshold, wages become relatively less imperative a factor in determining job satisfaction.
The first surveys the cost of living in London in order to compute a "low cost but acceptable" household budget, which is used to determine the poverty-threshold wage.
In economic parlance their "reservation wage"—or the threshold pay rate needed to coax them into and keep them in employment declined precipitously.
Once absolute incomes exceed a certain threshold, lower wages are easily tolerated when they don't entail relative disadvantage.
Each plot includes a solid vertical line at 0 to denote the threshold for nominal wage rigidities, a dotted vertical line at the inflation rate to denote the possible threshold for real wage rigidities and a dashed one that is a proxy of aggregate productivity developments (annual percentage change of value added per worker).
One in five public sector organisations said their answer to the higher wage threshold would be to make bigger cuts in staff numbers than previously planned.
Eighteen percent of children live in families with poverty-level incomes, and fully 39% of children live in families whose incomes don't meet the more realistic living wage threshold criteria.
There are solutions: last year the senior executive of a firm with large public sector contracts acknowledged to me that if local councils made it an iron cast condition of all contract bids that proposals must meet a specified, high wage threshold for workers, including cleaners and care workers, then businesses would have no choice but to relent.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com