By SANJANA IDNANI
Croydon is feeling the impact of the gig economy, as research found that the borough had the second slowest wage growth in London over the last seven years despite experiencing strong economic growth. Some figures suggest that wages in Croydon shrank in the year before covid-19 hit.
In 2019, Croydon had the fastest growing economy in the UK, with an annual growth rate of 9.3 per cent. Yet Croydon workers have seen wage growth of just 25 per cent over the last seven years, significantly below the London average of 32per cent.
The study was conducted on behalf of money transfer company, Xendpay, and used Office of National Statistics data to compare mean monthly wages from July 2014 to May 2021 across the country.
Croydon Council’s Economic Strategy report in 2019 found that 25 per cent of the borough’s workers are paid below the London Living Wage.
While workers in Croydon struggle on stagnating or slowly improving wages, their counterparts elsewhere in London, such as Hackney and Newham, saw their wages grow 45 per cent in the same period.
Other sets of ONS data suggest Croydon wages are getting worse. The Annual Survey of Hours and Earnings (ASHE) showed that there had been a 3.3 per cent decrease in Croydon wages from 2019.
ASHE data for Croydon as a place of residence provided extra insight by factoring in the earnings of those who commute for work. This data showed a 0.5 per cent increase in gross median weekly earnings from 2019, suggesting that wages from workplaces outside Croydon pushed up the average earnings of borough residents.
One reason behind these figures is the nature of jobs available in Croydon.
Jobs in Croydon’s main employment sectors, retail and social care, are often low paid.
Another factor is likely to be the rise of the gig economy – where businesses employ individuals for temporary, freelance “gigs”. More than one-fifth of all Londoners now work in the gig economy, such as in fast food outlets, as taxi drivers who can be booked via a smartphone app, or as delivery drivers and riders. Gig economy platforms such as Deliveroo, Uber Eats and Just Eat are particularly well-established in Croydon.
Gig economy workers face earnings uncertainty from hour to hour, never mind week to week, some with in-work poverty and stagnating wages.
Gig economy employers can also pay significantly lower wages by classing their workers as self-employed. There is no legal obligation to pay self-employed workers a National Minimum Wage.
Analysis of Deliveroo invoices from more than 300 riders by The Bureau of Investigative Journalism revealed that, on average, one in three made less than the National Minimum Wage for over-25s (£8.72 per hour). Some riders were paid as little as £2 an hour.
In April, dozens of Croydon Deliveroo workers joined a nationwide strike protesting low and unfair pay, highlighting the impact of rising insecure and low-paid gig economy work on Croydon livelihoods.
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