London should have higher minimum wage: think tank

Average wages and living costs higher in England's capital

A British think tank is calling on policy makers to increase the average wage that Londoners earn compared to the rest of the United Kingdom.

The Institute for Public Policy Research (IPPR) wants London's minimum wage to be set at 6.50 pounds ($13.88 Can) compared to the national hourly rate of 5.35 pounds ($11.42 Can).

Research by IPPR shows that a minimum wage worker in London earns just one-third of the average wage in the city, while the average minimum wage worker in the U.K. earns more than one-half the national average pay.

The think tank says that London's strong economy means the minimum wage can be increased without hurting the economy or job creation.

Kate Stanley, the head of the think tank's social policy, said the minimum wage in London has struggled to keep up with average pay raises and is worth a lot less than in other parts of the country because both the average wage and the cost of living are higher in London.

If the government wants to tackle the gap between rich and poor without increasing taxes, a higher minimum wage in London must be part of the solution, said Stanley.

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