Living wage and living income

It’s our mission to work on sustainable livelihoods and increased income. As a standard for a ‘decent income’ we promote the  concepts of living wage and living income as a benchmark in the work that we do with our clients. 

Living wage

The discussions on living wage has been around for a long time, but in the last decade the consciousness on the relation between the standard of living of workers and their income from wages has exploded. This is reflected in how sustainability standards have embraced the internationally acknowledged Anker & Anker methodology to calculate living wages including defining the gap between prevailing wages and the living wage benchmark. It has resulted in a growing number of efforts and experiences on how to close the gap in the textile industry as well as in several agricultural sectors like flowers and bananas.

Fair and Sustainable builds on this concept and offers services to public and private sector partners to understand the concept by training staff members or supporting the calculation of a living wage when there is no recognized benchmark available. Furthermore, we provide concrete advice on how to bridge the gap between the current and the desired situation as certain clients are ready to take concrete steps to achieve wage improvements for workers in their supply chain(s).  

Living Income

The concept of living income is more recent than that of living wage and refers to the income of smallholder farmers. Assessing what an overall living income is for smallholders looks very much like the assessment for workers, with some additional information needed on the extent of home consumption of crops produced, local land taxes, water charges for irrigation etc. However, many smallholders do not produce one crop, but several, so the relative importance of specific crop matters in the overall household income gathering. Therefore also assessing the gap has to weigh the specific crop under study to the overall household economy of the smallholders involved. As, this area of expertise is relatively new, it implies a testing mindset as well as a need to be very transparent about underlying assumptions of calculations done. Also, bridging the gap can be more complicated than for a living wage, as it is needs to look at prices set in a market economy, productivity as well as production costs etc.

Fair & Sustainability has experience with this new concept due to their value chain development and living wage work. We offer services to public and private sector partners to understand the concept by training staff members and can support the development of a living income program.

Examples

Coordinating of a living wage pilot in the young plants sector  –  Fairtrade International, 2018/2019

Consultant: Marjoleine Motz

Advice on implementing a living wage strategy with all suppliers including field test –  EOSTA, 2018 & 2020

Consultant: Marjoleine Motz