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Ordinary wages ‘flatlined till 2015’


28 May 2011

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Ordinary workers are unlikely to see any benefit from the economic recovery, with wages flatlining until 2015, according to a new report.

Living standards for the 11 million-strong UK workforce on low or middle incomes were already stuttering before the recession, says the Resolution Foundation thinktank, and even a steady increase in growth is unlikely to lead to increases any time soon.

The group, which bases its analysis on government projections, said the average pay would be no higher in 2001 than it was in 2015. It said stagnating wages, high personal debt levels and a drop in the “middle-skilled” job markets would have an impact on living standards. And with cuts to tax credits on the way, it is only set to get worse.

The report added that those on lower wages had already lost out on the economic boom years. Between 2003 and 2008, average wages flatlined and disposable income dropped in every region except London, despite economic growth of 11%.

Rising living costs hit people on lower incomes worst, with low-to-middle wage workers dealing with inflation up to 1% greater than for higher earners since 2006.

Copyright © Press Association 2011

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