UK workers facing worst wage squeeze 'since Napoleonic wars'
Real wages not expected to return to pre-crisis levels until 2022, warns IFS
Workers in the UK are experiencing the worst period for wage growth since the Napoleonic wars, with the financial crash continuing to cast its shadow over the economy.
While employment is at record levels, wage growth flatlined over the past decade and average earnings are not expected to return to their pre-crash levels until 2022, says the Institute for Fiscal Studies (IFS).
In his Budget this week, Philip Hammond claimed wages for the lowest-paid grew faster last year than in any of the past 20 years, partly as a result of the introduction of the national living wage for over 25s.
However, analysis of the latest forecasts from the Office for Budget Responsibility, on which the Chancellor bases his policies, shows real pay is expected to start falling in the second half of next year as rising prices outstrip increases in wages.
The IFS said the past decade of weak productivity and flatlining real wages has been "unprecedented" in modern times, says The Guardian.
In addition the OBR's figures show government borrowing remains stubbornly high, which will mean a "third parliament of austerity".
Think-tank Resolution Foundation said weak pay growth combined with more than £12bn of benefit cuts means that for the poorest third of households, this parliament is "set to be worse than the years following the financial crisis".
With real average income growth set to fall to 0.2 per cent by 2020, the years from 2011 to 2020 will be the worst decade for pay growth for 210 years "since the Napoleonic wars", it added.