UK Wage Squeeze to Continue for Even Longer

15th August 2014

Responding to today's (Wednesday) quarterly inflation report from the Bank of England, TUC General Secretary Frances O'Grady said:"It is hugely concerning to hear that the Bank has cut its forecast for wage growth in half. The economy's getting bigger but not better with Britain's pay squeeze now set to continue even longer.

“It's not just wage stagnation that's pushing down incomes, living standards are falling because so many of the new jobs being created are low-skilled, don't have enough hours, or are in low paid self-employment.

“It deeply worrying that the Bank says 'average household real incomes have yet to stage a meaningful recovery'. If people don't have money in their pay packets to spend on goods and services it's hard to see how we can return to sustainable growth. Consumer spending is holding up for now despite people's real pay falling, but the danger here is people running down savings or increasing their debts.

“That's why Britain needs a pay rise, because a recovery built on stronger household incomes will be a recovery built to last."