If next government doesn’t act, UK wage growth will stay at the bottom of the league, warns TUC

British workers will suffer a fall in real wages in both 2017 and 2018, as workers in most other advanced economies see their pay rise, according to new TUC analysis released today (Wednesday).

The OECD forecast that that real wages in the UK are on course to fall by -0.5% by the close of 2018.

However, real wage growth in other OECD countries will increase by an average of +2.6%.

The UK will be one of just five OECD countries to experience a fall in real wages – with only Greece, Italy and Austria set to fare worse over 2017 and 2018.

UK real wages will be -6.8% lower in 2018 than they were in 2007 before financial crisis, according to OECD predictions.

Only Greece and Italy will have seen worse real wage losses since the crash.

TUC General Secretary Frances O’Grady said:

“British workers have endured the longest pay squeeze since Victorian times. And now even more pain is on the horizon.  

“Britain badly needs a pay rise – and all the political parties must explain in their manifestos how they will boost living standards across the UK.

“A good start would be to scrap the unfair pay restrictions on public servants. It is disgraceful in the world’s sixth richest economy that nurses are having to use food banks to get by.”

ENDS

Notes to Editors:

Real wage growth in OECD countries

Real wage growth is derived from the tables accompanying the OECD country forecast published with the November 2016 Economic Outlook, outcomes in post-crisis years are supplemented with the OECD forecast for 2016 to 2018. Compensation per employee (Table 17) is adjusted for price with the consumer price index (Table 15).

http://www.oecd.org/eco/outlook/economic-outlook-annex-tables.htm

In their March forecast the Office for Budgetary Responsibility show UK real wages rising over the same period (by 0.6%), in contrast to the decline on the basis of the OECD forecast. The latest ONS real average weekly earnings figures for February 2017 show a -0.4% decline on the year (on the single month measure).

- All TUC press releases can be found at tuc.org.uk/media
- TUC Press Office on Twitter: @tucnews