Wage growth slowed again in the second half of 2015
New analysis published today by the TUC has revealed that average pay in the UK is still worth £2,270 less in real terms than it was in 2008, equating to a shortfall of £44 a week. Although there are regional differences (South East wages are worth £2,500 less for example), all regions suffered significant losses between 2008 and 2015.
The TUC says the figures confirm that workers in the UK still have a long way to go to restore the earnings they lost ‘following the longest squeeze on wages since records began in the 1850s’.
Although the average UK annual wage increased in real terms between 2014 and 2015, monthly data from the Office for National Statistics (ONS) shows that wage growth slowed again in the second half of 2015.
This problem could, the TUC warns, be made worse by the government’s plans to continue holding back wages in the public sector, which will have a ‘significant drag’ on average wage growth. There are also concerns that the government’s controversial Trade Union Bill will weaken the power of workers to negotiate a fair share of economic growth through decent pay rises.
This could lead to slower wage growth becoming a longer-term problem, causing trouble not only for workers and their families, but also for businesses that rely on their spending. and harming the economy as a whole.
The TUC is therefore calling on the government to engage with trade unions on a positive agenda to improve both pay and productivity, including stronger collective bargaining rights, modern wage councils to ensure that pay increases follow productivity gains, and worker representation on remuneration committees to bring back a bit of reality to boardroom pay.
TUC regional secretary Megan Dobney said today:
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“Working people deserve a fair share of the wealth they create. But despite five years of economic growth, the pressure on their living standards has barely let up. The average annual wage in the South East is still worth over £2,500 less than it was back in 2008.
“The government must do the right thing for the economy, and the right thing by workers. They should invest more in the skills and infrastructure the UK needs for higher productivity. They should make sure that working people see productivity gains in their pay packets. And they should work positively with trade unions, instead of attacking workers and their representatives with the Trade Union Bill.”