More workers are living hand-to-mouth on less than a ‘living wage’ than a year ago—despite the economy coming out of recession, shock figures by top Canary Wharf analysts have revealed.

The numbers on meagre pay has risen by one per cent compared to 2013, according to KPMG accountants.

Worst area in east London is Hackney, where one-in-five workers are on less than the official Living Wage—more than 20 per cent compared to the London average of 17pc.

But workers in neighbouring Tower Hamlets—where the Living Wage campaign was first launched in Whitechapel 10 years ago by Telco, The East London Communities Organisation—are slightly better off. Only one-in-10 falls below the benchmark, the lowest rate in London, researchers confirmed.

“Too many employees are stuck in the spiral of low pay,” KPMG’s Mike Kelly said.

“Many workers are forced to live hand-to-mouth, putting the squeeze on household finances.

“It was easy for businesses to hide behind the argument that increased wages hit their bottom line.

“But there’s evidence to suggest the opposite, that higher retention of staff means higher productivity.”

Worst area in London is Brent, at 35pc scratching a living on poverty wages, followed by Waltham Forest at 33pc.

The ratio of those earning less than £8.80 an hour London minimum is much higher among part-time workers, especially women, the figures show.

The number of youth unemployed continues to fall, but those under 21 remain most likely to be caught in the ‘working poverty’ trap, earning less than enough to support basic necessities.

Telco, now known as Citizens UK, launched the Living Wage in 2004 and scored its first success ironically in Canary Wharf, where the latest KPMG analysis was made. Banks like Barclays were first to sign up. Tower Hamlets Council followed, making the Living Wage part of its business orders with suppliers and contractors.

The campaign spread across Britain, with 1,000 organisations now pledged to honour a living wage.