The report, Monitoring Poverty and Social Exclusion 2014, is based on wage data and comparative research on factors such as the retail price index and average housing costs.
It also revealed the average hourly rate for men fell from £13.90 to £12.90 between 2008 and 2013. For women it has decreased from £10.80 to £10.30. Both figures take into account inflation.
Across the same period the average hourly income for the lowest-paid 25% has fallen by 70p for men and 40p for women, making this group the worst affected by the fall in wages.
There is also an issue with getting people out of long-term, low-paid work. Only one-fifth who were in low-paid roles 10 years ago have now moved out of it. Additionally, there are 1.4 million people in part-time work because they cannot find full-time positions.
Joseph Rowntree Foundation chief executive Julia Unwin warned the UK will not reach its "full economic potential" if large numbers of people are still struggling with low incomes.
"We are concerned that the economic recovery we face will still have so many people living in poverty. It is a risk, waste and cost we cannot afford," she said.
“A comprehensive strategy is needed to tackle poverty in the UK. It must tackle the root causes of poverty, such as low pay and the high cost of essentials.”