Pay inequality has soared since 2000, says Wales TUC as wages in London race away from Wales

Wage inequality has soared over the last 13 years according to a Wales TUC analysis published today (Monday) to coincide with the beginning of the TUC’s first Fair Pay Fortnight which runs until Sunday 6 April 2014.

The figures – based on full-time earnings from the Annual Survey of Hours and Earnings (ASHE) – show that between 2000 (when the data was first collected) and 2013 the pay gap between the top 10 per cent in London and the bottom 10 per cent of earners in Wales rose by 9.8%. This is far higher than the overall UK average of five percent over the same period.

The TUC research also reveals how much the top 10 per cent of earners across the UK bring home and how their salaries vary greatly. The highest top earners are in London where they receive £82,000 a year, up from £58,000 in 2000. In contrast take home pay for the bottom 10 per cent in Wales stood at just £14,092 in 2013, up from £9,797 over the same period.

On this measure, the highest top earners after London are in the South East who are on £57,000 and the East of England where they earn about £52,000 per annum.

The TUC analysis reveals that within most UK regions and nations the pay inequality ratio is rising – up by four per cent between 2000 and 2013 in the North West, three per cent in the East of England, and two per cent in Scotland and the North East. Inequality within London rose most sharply at 14%.

Only Wales and the South West have seen pay inequality reduce over the last 13 years. However the TUC believes this is more down to top earners not doing as well as in other parts of the UK, rather than those at the bottom getting a better deal.

Wales TUC described the growing pay gap between Wales and London as an indictment of the grossly unbalanced state of the UK economy.

Wales TUC General Secretary, Martin Mansfield said:

“This new analysis shows how wage inequality has soared in the UK with a grossly unjust and growing gap between top earners in London and the South East and the bottom 10 per cent in Wales.

“This pay gap is bad news for our economy and bad news for living standards.

“The dominance of London and the South East, and the finance sector in particular, has undermined growth, jobs and wages in Wales and many other parts of the UK. In fact, by the measure of GVA output, the UK stands out as the most unequal nation in Europe. Unless this trend stops now and more high-skilled jobs with decent pay are created, this worrying pattern is likely to become even more entrenched.

“Everyone must benefit from the recovery, not just those at the top. The TUC wants to see a greater commitment to pay the living wage from both government and employers, a crackdown on excessive executive pay, and modern wages councils which could set higher minimum wages where employers can afford to pay more.

“During Fair Pay Fortnight we’re asking workers to back our call to MPs to get all political parties to put decent pay at the top of their agendas in the run up to the election.”

ENDS