Salary difference in London compared to the rest of the UK
  • By Check-a-Salary
  • Posted Wednesday 19 th January 2022

Salary difference in London compared to the rest of the UK

If you ask anyone in the UK about the North/South divide, they will be quick to tell you that the average salary in London and its surrounding areas are significantly higher than in other regions. But, is this true, and if it is, what is the salary difference in London compared to the rest of the UK?

Average salary UK, by region

Before we look at why wages differ across the UK, we reveal the average salary for each region, starting with the highest average salaries.

Average London salary

The average wage in London is higher than anywhere else in the UK, at £41,506.29 per year.

Isle of Man average wages

Employees working in the Isle of Man should expect an average salary of £33,940.91 annually.

Pay in South East England

Pay in the South East averages out at £30,403.09 per year.

Eastern average salary

The average Eastern salary is £28,956.92 annually.

North West salaries

Professionals in the North West of the country earn an average salary of £28,817.48 per year.

West Midlands average salary

People living in the West Midlands earn an average wage of £28,574.31 per year.

Scotland average salary

Salaries in Scotland are at an average of £28,351.63 per year.

Yorkshire and the Humber average salary

Employees in Yorkshire and the Humber earn approximately £27,603.86 annually.

South West average salary

Average salaries in the South West are £27,573.80 per year.

Income in Wales

The expected salary for people working in Wales is £27,056.51 per year.

East Midlands salaries

Full-time workers in the East Midlands earn an average salary of £26,908.12 per year.

Northern Ireland salaries

Pay in Northern Ireland averages out at £26,547.08 per year.

North East England salaries

Wages in North East England average out at £26,540.42 annually.

So, Londoners do, in fact, have the richest salaries.

Average salary by City

Here are the national statistics for pay in major cities in England and the UK.

  • London: £41,506.29
  • Reading: £36,515.73
  • Birmingham: £34,247.70
  • Edinburgh: £32,635.42
  • Leeds: £32,523.51
  • Glasgow: £31,273.90
  • Cardiff: £30,666.49
  • Belfast: £30,423.46
  • Nottingham: £30,115.61
  • Newcastle upon Tyne: £29,949.84
  • Coventry: £29,710.73
  • Liverpool: £29,580.06
  • Leicester: £28,687.63
  • Sheffield: £28,424.28
  • Bradford: £28,149.96
  • Sunderland: £27,434.29
  • Wakefield: £27,389.86

The statistics show that Londoners have the highest paid jobs, with the lowest in Wakefield.

Discover the highest paying jobs in the UK.

London weighting

It is clear from the figures that the average salary in London is above the national average. The London average salary is inflated by the number of high-earners living and working in London. A third of the earners in the top ten percent work in London.

It is important to note that the salaries quoted are the average and not the median. It is a crucial distinction to make because these two figures are calculated quite differently. The average is the total of all salaries divided by the number of earners. The median is the middle value, where 50% of people earn more money and 50% earn less.

According to the Office of National Statistics (ONS) and their Employee Earnings in the UK: 2021 report, the median wage per week for full-time employees was £611. According to Statista, people in London earn a median salary of £766 per week. When we use this data to make a London salary comparison, it is clear that the highest wages are found in Inner London.

Let’s take a look at an example for a specific role. In the capital, a public sector worker earns £36,759.19 per year. A public sector worker in cities such as Bradford or Sunderland earns less than £24,000 per year.

London pay gap and cost of living

Due to the number of high-earners in London, the capital sees the most significant income gap, with the top one percent having jobs that pay up to fifteen times that of those working in the bottom one percent of jobs. The UK average pay gap sees the wealthiest earners with a wage eight to ten times higher than the lowest earners.

When we consider the average salary in London, we must also take into account the cost of living in London. Housing costs, rent, and even food is more expensive in and around London. For example, you can expect to pay somewhere in the region of £500,000 for a house in London. However, according to Rightmove, the typical price for a home in Bristol is £360,000, and elsewhere in the country, you could expect to spend half that of Londoners.

It is a similar story if we look at housing costs for people who rent a home or apartment. Whichever way you compare it, the disposable income of Londoners is severely depleted by their expenses. In real terms, employment in London pays more than regions such as East Anglia or Greater Manchester, but it also costs more to live there.

According to figures from ONS, salaries (including bonuses) grew by 4.2% last year. However, when this figure is adjusted for inflation, there is minimal growth, equating to 0.4%.

Minimum wage

If you are looking for jobs in London, you should earn a minimum wage of £9.50 per hour. However, the London Living Wage is £11.05 per hour. Unfortunately, employers offering jobs in the region are not required by law to pay this independently calculated rate. Still, it is worth knowing when you come to negotiate the salary of a specific role.

Wage growth

Wage growth in jobs is another topic for you to consider. If you are negotiating a salary raise, aim to agree on a figure that at least matches inflation. If your wage increase is less than inflation, you will be potentially worse off than you were last year.

Salary FAQs

Here we answer your salary questions.

How much higher is a London salary?

A Londoner earns £766 weekly, compared to £611 elsewhere in the UK. The median salary for workers outside of the capital is 25% lower.

Why are London salaries higher?

It costs more to buy a home, rent a house, and buy food.

What is the average salary in the UK, excluding London?

Excluding Londoners, a typical UK salary is just above £30,000 annually.

How do salaries vary across the UK?

The gap between jobs in the capital and the lowest paid region in the UK is approximately £14,000.




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