Housing crisis hits labour market

Landlords cash in on the job prospects of the young

Young people who move to cities with more job vacancies will be £1002 per year worse off because of higher rents, according to new analysis from PricedOut, the campaign for lower cost housing.

Labour_market.jpg

Private tenants who work in England’s top cities for employment are paying £251 more in their monthly rent than the national average, but only earn an extra £167 per month on average, after tax.

While the nine towns and cities where it is easiest to get a job do offer higher pay, this is more than offset by the cost of renting, leaving young people spending 36% of their typical earnings on rent. In the nine areas where it is most difficult to find a job, the equivalent rent is only 24% of local median income.

In Hull, where there are 32 jobseekers chasing every vacancy, the average monthly rent on a one-bed property of £325 is 21% of the median monthly income of £1640. Meanwhile in Oxford, where there are nearly 2 vacancies for every jobseeker, the average rent of £825 is a whopping 41% of the median monthly income of £2020.

In London, where there are 1.44 people after every job, it’s even worse as someone on average income spends 50% of it on rent. Despite earning £3804 more per year than the average person nationally, the typical Londoner is actually £4027 worse off after they’ve paid for somewhere to live.

Labour_market_2.jpg 

These findings illustrate a broken housing market that is failing to make work pay. PricedOut are therefore calling for a large-scale programme of housebuilding in the priciest parts of the country to push rents down and make moving to find work worthwhile.

Dan Wilson Craw, PricedOut spokesman, said:

“Landlords in our most economically successful cities are cashing in on young people who need to move to find work. We desperately need more houses built in places where jobs are being created to ease the pressure on rents. If the government wants to make sure work pays, it must act urgently to stop young workers handing over all their extra earnings – and more – to landlords.”

Ends

Notes to editors:

For further information please email press@pricedout.org.uk.

PricedOut (www.pricedout.org.uk) represents the millions of people who would like to buy their own home but cannot buy because of high house prices and high rents. The campaign is independent of any political party and supports initiatives to increase the supply of good quality housing in the priciest areas of the UK.

 

Median income before tax

Median rent

Rent as % of income

England average

1,850

500

27%

Worst cities to find a job

     

Salford 

1,796

445

25%

Rochdale

1,583

325

21%

Hull

1,640

395

24%

Sunderland                 

1,633

400

24%

Wirral

1,766

325

18%

Wolverhampton           

1,659

395

24%

Southend

2,028

525

26%

Middlesbrough

1,640

415

25%

Bradford

1,595

390

24%

Plymouth

1,682

450

27%

AVERAGE

1,702

407

24%

Best cities to find a job

     

Cambridge

2,119

795

38%

Aberdeen

 

No rent data

 

Guildford                     

2,284

800

35%

Reading                     

2,292

695

30%

Oxford                       

2,020

825

41%

Winchester

1,934

695

36%

Exeter

1,672

575

34%

London

2,310

1148

50%

Milton Keynes

2,043

550

27%

Slough

2,195

675

31%

AVERAGE

2,096

751

36%

 

Median income

Median rent

Disposable income after paying a year’s rent

Difference between best 9 and worst 10

£394 (£268 after tax)

£344

-£916

Difference between best 9 and national average

£246 (£167 after tax)

£251

-£1002

Difference between London and national average

£459 (£312 after tax)

£648

-£4027

The best and worst places to find a job were identified by Adzuna.

http://www.adzuna.co.uk/blog/2013/12/31/adzuna-jobs-report-december-2013/

Median rents for 1-bedrooom properties in Local Authorities in England were taken from the Valuation Office Agency December 2013 statistics. Rent figures for Scotland were unavailable.

Median incomes by Residence-Based Travel to Work Area were taken from the ONS Annual Survey of Hours and Earnings 2013. The figures based on income after tax were calculated based on a marginal tax and national insurance rate of 32%. Income figures for Andover were used for Winchester; income figures for Manchester were used for Salford.


Be the first to comment

Please check your e-mail for a link to activate your account.