Huge wage squeeze means workers have lost more than £30 a week since 2007

date: 2 September 2013

embargo: 00:01hrs Wednesday 4 September 2013

Huge wage squeeze means workers have lost more than £30 a week since 2007

In the last five years UK workers have suffered a huge squeeze on their incomes, with average pay falling by 6.3 per cent in real terms - a real terms loss of £30.30 in the pay packets of employees working a 40-hour week, according to research published today (Wednesday) by the TUC as part of its Britain Needs a Pay Rise campaign.

The TUC analysis of official figures compares hourly pay rates in 2007 (at 2012 prices) with those in 2012, and shows the extent of the pay squeeze being felt by families across the UK as incomes fail to keep pace with rising prices.

The North West is the hardest hit region in the UK. Here average hourly pay has fallen from £11.43 in 2007 to £10.52 in 2012 - an 8 per cent real terms drop. Full-time workers in the region are taking home £36.41 less in real terms a week as a result.

Not far behind the North West was Yorkshire and the Humber where workers have seen their pay reduced by 7.6 per cent in real terms over the five years - a £34 weekly loss of income for those on a 40-hour week. In the West Midlands, pay fell by 7.2 per cent - a loss of £32.58 a week.

Darlington was the local authority area hardest hit by the squeeze on wages. In this part of the North East, workers saw their hourly real pay rates fall by a massive 16.2 per cent between 2007 and 2012, which meant a huge £75.94 real terms cut in the weekly pay packets of full-time employees.

Workers in the East Riding of Yorkshire didn't fare particularly well either - hourly pay rates dropped from £12.63 to £10.62, a 15.9 per cent fall and a whopping £80.34 loss a week. People living in the East London borough of Newham suffered the third biggest squeeze on pay in the UK - over the five years real hourly pay fell by 13.8 per cent, which meant workers there found themselves £67.28 a week worse off in real terms.

Across the UK men have seen their pay hit harder than women. According to the TUC analysis male workers have seen their hourly real pay rates drop from £13.60 to £12.60, a 7.4 per cent fall which works out at £40.14 less in their weekly pay packets in 2012 compared to 2007. Female employees saw their wages decline by 4.7 per cent in real terms over the five years, a loss of £19.96 for an average full-time worker on a 40-hour week.

Commenting on the figures, TUC General Secretary Frances O'Grady said: 'Across the UK families are still really struggling to make their money go far enough - and are often having to go into debt - as they experience a huge squeeze on their household incomes.

'With real wages still falling, most people are being forced to use their credit cards or their dwindling savings if they need to purchase anything beyond the most everyday of items.

'Workers' real hourly pay rates have taken a hit over the past five years because wages have failed to keep up with inflation. But this fall is also a result of the worrying increase in insecure and short-hours employment.

'And in many cases when people have lost their jobs, and are fortunate enough to find work, they are forced to take jobs with fewer hours and on lower rates of pay. This is not the way to build a strong economy - the UK needs far more better jobs on much better rates of pay.

'Next week at our annual Congress our Britain Needs a Pay Rise campaign will take centre stage as unions continue to push for decent and fair wages across both the private and the public sectors.

'We will also be urging those employers who can afford to pay a living wage to start doing so. If workers have more money in their pockets, they will feel more confident about spending that extra cash and that's something that families, businesses and UK the economy can all benefit from.'

NOTES TO EDITORS:

Real wages losses by region and nation

Local authority areas with the biggest real wage losses

Real wages losses by gender

- Due to limitations with the ONS data, it was not possible to provide robust data on wage changes for eight local authorities

- The full analysis can be found here http://www.tuc.org.uk/tucfiles/647/real wage falls by local authority.xls

- The TUC's campaign plan can be downloaded from www.tuc.org.uk/campaignplan

- All TUC press releases can be found at www.tuc.org.uk

- The deadline for free media passes for Congress 2013 was Wednesday 28 August. Until noon on Thursday 5 September credentials can still be applied for online at www.tuc.org.uk/media_credentials although each late application will now cost £75.

- Follow the TUC on Twitter: @tucnews

Contacts:

Media enquiries:
Liz Chinchen T: 020 7467 1248 M: 07778 158175 E: media@tuc.org.uk
Rob Holdsworth T: 020 7467 1372 M: 07717 531150 E: rholdsworth@tuc.org.uk
Alex Rossiter T: 020 7467 1337 M: 07887 572130 E: arossiter@tuc.org.uk