UK workers’ wage squeeze is longest since the 1870s
At the RSN seminar in Shrewsbury on Tuesday and in an interview for AgeUK Radio today I found myself suggesting that the economy is broken more than “officialdom” wants to let on and then discussing the negative effects it is having on rural dwellers. This article – which if you go to it direct has a wonderful social commentary picture – reinforces my point. In reading it please remember that it costs about 20% more to live in rural than urban England. It tells us:
Britain’s workers are suffering the most protracted squeeze on their incomes since the long depression of the 1870s and are now well into their fourth year of falling real wages.
High inflation and stagnant pay for many workers mean that real wages have now fallen for 40 months, according to calculations by the TUC. It says that is the longest such stretch of financial pain since 1875 to 1878, when the world economy was mired in the so-called long depression.
The union group’s calculations, based on Bank of England data, followed news on Tuesday that inflation rose to its highest level for more than a year in June. The consumer prices measure of inflation hit 2.9% and many economists expect it to push higher still in coming months posing a challenge for the new Bank of England governor, Mark Carney, and his fellow policymakers as they look for ways to boost Britain’s fragile recovery while keeping a lid on living costs.
The TUC’s general secretary, Frances O’Grady, said the rise was “further bad news for households and the wider economy” and mean pay, currently rising at an average annual 1.3%, had failed to keep pace with prices for more than three-and-a-half years.