UK employees are missing out on wage growth because of pay stagnation since the financial crisis, a new study has found.
According to an analysis by the Trades Union Congress (TUC), workers in the country will earn £3,600 less this year because salaries are not keeping up with the OECD average.
The findings revealed that there has little movement in UK pay rates since 2008, with real pay down by 2.7% compared to then. In contrast, during the same period across the OECD wages have grown by an average of 8.8%.
Based on OECD’s calculations, the TUC predicts UK employees will lose out on a further £3,800 in 2024 as salaries continue to fall behind.
The union body emphasised that pay growth in the majority of OECD countries had resumed to pre-crisis rates by 2015. However, in the UK levels are still lower than in 2008, with the UK ranking 27th out of 33 in terms of wage growth.
TUC general secretary Paul Nowak said: “Everybody who works for a living deserves to earn a decent living. But workers up and down the country are suffering a pay loss of historic proportions.
“Since the financial crash, in most parts of the world workers have seen their real wages go up. But the UK has been an international outlier on pay with family budgets being shredded.”
According to the TUC, UK employees are being hit by “a double whammy” of high inflation and historically poor wage growth. It believes years of wage cuts have led to workers being “brutally exposed” to the increasing cost of living.
Nowak added: “The abysmal wage growth of the past 15 years has left UK households brutally exposed to the current cost of living crisis. UK workers are being hit by a double whammy of uniquely high inflation and really poor wage growth.
“Instead of scapegoating workers who are just trying to keep their heads above water, ministers must come up with a credible plan for sustainable economic growth and raising living standards. Without action, the UK will continue to lurch from crisis to crisis.”