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A PUBLIC-SECTOR workforce crisis is gripping London and the south as rising rents have made it uninhabitable for low-paid workers.
A report by consultancy firm PricewaterhouseCoopers (PwC) said there is an “urgent need” to build new affordable homes as stagnating public-sector pay has made it impossible for workers to keep up with the cost of housing.
The firm says rent should amount to less than 30 per cent of gross annual income to be considered affordable.
But it said that this threshold had been crossed in high-cost areas of the country.
The report found that Londoners in their twenties are spending over half of their income on rent, making it impossible to save up to buy a home.
PricewaterhouseCoopers chief economist John Hawksworth said: “The last five years has seen rental affordability ratios deteriorate and, in the UK as a whole, the amount spent on rent over this period has grown by 8 per cent, while at the same time earnings growth remains relatively weak and below levels seen before the financial crisis.
“This is not only having an impact on social mobility, it will also hinder national productivity growth in the longer term by preventing people from moving to places in the UK where they can be most productive.”
Mr Hawksworth argued that the east and the south-west of England are also becoming unaffordable for many key workers.
He said: “We risk seeing professions that are integral to the UK’s public services struggling to afford to rent in several regions.”
Labour national executive committee youth representative Lara McNeill, who lives in London, told the Star: “These revelations won’t startle a single person forced to face financial uncertainty for the crime of working the sort of low-paid jobs that keep London going.
“To tackle this bleak inequality that threatens to destroy all prospects for our country’s essential services and young people, a radical overhaul of the housing market and a pay rise for millions, in line with union demands, is not just desirable — it is necessary.”
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