Croydon wages are shrinking as borough’s economy grows


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.

Frying tonight: Croydon’s economic growth has not been matched by wages

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.

On your bike: there’s plenty of gig work available, just not much with decent pay

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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2 Responses to Croydon wages are shrinking as borough’s economy grows

  1. Lewis White says:

    If Man (and Woman) cannot live by bread alone, maybe a town cannot live by restaurants and takeaways alone. The danger of building housing on industrial land ( as has taken place in Coulsdon Town centre near Coulsdon Town Station) is that sites for workshops has reduced.

    As industrial land in Inner London continues to shrink, as a result of redevelopment, and flats multiply in places like the Millwall stadium area (it started there back in the Thatcher era),
    it is important to hold on to industrial land in Croydon , otherwise the capital’s needs for servicing the needs of shops and businesses, as well as all the flats and houses, will become ever more expensive , with a greater carbon footprint as “white van man and woman” has to drive from outer to inner with their van loads of stuff, and plumbers working in central London have to live in Milton Keynes..

    It seems natural that jobs in Croydon might be slightly lower paid than in central London, but maybe there are just too many fast food outlets, and not enough factories left. I am assuming here that factory jobs are better paid, on average, than catering jobs, but of course, I could be wrong.

    The other day I happened to meet a local resturant delivery driver who services a number of local takeaways. He is now with one of the big delivery companies. I admired his electric car, which he said had cost £ 30,000. How is business? I said. It was clearly good. He was happy, which made me feel happy.

    One hopes that he gets sick pay , and that he is well-supplied with work.

    Perhaps good wages depend on workers having skills, which means education, and on the job training. Choices of employment would benefit from having a mixed economy in Croydon– technical jobs, factory jobs, office jobs and more.

    Sadly, shop jobs have taken and will continue to suffer from a massive reduction in numbers as internet shopping increases.

    Office jobs too have declined. Croydon still has a number of insurance companies, but used to have many more.

    Many jobs in the technical sector have migrated to Crawley (along with Nestle).

    Long-term, maybe the ageing population will reduce the job pool, resulting in higher wages for those left in work.

    • Chris Flynn says:

      I have a recollection of a quote (maybe from an American in the 80s) along the lines of “You can’t have an economy based on holding the door open for each other!”.

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