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Fall in UK living standards deeper than thought, ONS reveals Fall in UK living standards deeper than thought, TUC says
(35 minutes later)
The UK’s fall in living standards has been worse than previously thought, the TUC claimed, after new figures showed a bigger squeeze on households’ disposable incomes.The UK’s fall in living standards has been worse than previously thought, the TUC claimed, after new figures showed a bigger squeeze on households’ disposable incomes.
The Office for National Statistics published sweeping updates to its previous estimates on the economy on Tuesday that suggested Britain recovered from the recession three-quarters sooner than initial estimates. Its move to new ways of measuring GDP put the size of the economy at 2.7% above its pre-crisis peak in 2008, compared to the previous estimate of 0.2%. The Office for National Statistics published sweeping updates to its previous estimates on the economy on Tuesday that suggested Britain recovered from the recession three-quarters sooner than initial estimates. Its move to new ways of measuring GDP put the size of the economy at 2.7% above its pre-crisis peak in 2008, compared with the previous estimate of 0.2%.
But the TUC said the figures also revealed that the toll taken by years of falling real wages was greater than previously thought, as estimates of household disposable income were revised to show it further off its previous peak.But the TUC said the figures also revealed that the toll taken by years of falling real wages was greater than previously thought, as estimates of household disposable income were revised to show it further off its previous peak.
For 2013, real household disposable income per capita, described by the TUC as “the most comprehensive measure of living standards”, was 2.6% below its peak according to the latest data. It was £16,881 in 2013 down from a peak of £17,324 in 2007. On the previous figures, the measure had been 1.8% off the peak, standing at £15,764 in 2013 down from a peak of £16,060 hit in 2009.For 2013, real household disposable income per capita, described by the TUC as “the most comprehensive measure of living standards”, was 2.6% below its peak according to the latest data. It was £16,881 in 2013 down from a peak of £17,324 in 2007. On the previous figures, the measure had been 1.8% off the peak, standing at £15,764 in 2013 down from a peak of £16,060 hit in 2009.
The TUC general secretary, Frances O’Grady, said: “While the size of the economy has been revised up, household incomes have been revised down. It turns out the UK’s living standards crisis is even worse than we thought.”The TUC general secretary, Frances O’Grady, said: “While the size of the economy has been revised up, household incomes have been revised down. It turns out the UK’s living standards crisis is even worse than we thought.”
“This is set to be the first full parliament since the second world war when the government leaves office with people’s pay packets worth less than when they came into power. There is something deeply wrong when the economy is growing, but the people who do all the work face ever shrinking pay and falling living standards.”“This is set to be the first full parliament since the second world war when the government leaves office with people’s pay packets worth less than when they came into power. There is something deeply wrong when the economy is growing, but the people who do all the work face ever shrinking pay and falling living standards.”
The Treasury seized on the upward revision to GDP growth in the second quarter as further proof “the government’s long-term economic plan is working”. But opposition Labour and trade unions have sought to highlight that the squeeze on households continues as wages fall behind inflation, meaning pay packets are shrinking in real terms for many workers.The Treasury seized on the upward revision to GDP growth in the second quarter as further proof “the government’s long-term economic plan is working”. But opposition Labour and trade unions have sought to highlight that the squeeze on households continues as wages fall behind inflation, meaning pay packets are shrinking in real terms for many workers.