Real wages 13.6% drop!

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THERE has been a 13.6% drop in the real value of average earnings of full time workers in employment in the UK between April 2008 and April 2015, a new GMB study of official earnings data shows.

In April 2008 the mean gross annual earnings for all employees in employment in the UK, according to the Annual Survey of Hours and Earnings (ASHE, was £31,494. The ASHE figure for the mean gross annual earnings for all employees in employment in the UK for April 2015 was £33,689.

This is an increase of £2,195 or just 7%.

However, between April 2008 and April 2015 inflation has been 20.6%. This means the drop in real value of earnings between April 2008 and April 2015 has been 13.6% for the UK. The drop in the real value of average earnings between April 2008 and April 2015 for full time employees in employment resident in London has been 23.2%. This is the largest drop for all 12 regions in the UK.

The next largest drop is the South East with a drop of 16%, East Midlands 15.7%, Yorkshire and The Humber 14.9%, North West 12.4%, West Midlands 11.8%, East 11.5%, Wales 11.3%, South West 10.6%, Scotland 6.7%, North East 5.0% and Northern Ireland 4.9%. The details are set out in the table below for the UK and all 12 regions.

The 20 areas with the steepest decline are: Hammersmith and Fulham 52.6%, Islington 35.1%, Camden 29.3%, Southwark 28.3%, Ealing 26.6%, Surrey 26.0%, Bedford 25.6%, West Berkshire 24.2%, Warrington 23.5%, Greenwich 23.4%, Tower Hamlets 22.6%, York 22.3%, Denbighshire 22.1%, Buckinghamshire 21.8%, Blackburn with Darwen 21.4%, Sheffield 21.0%, Sutton 21.0%, Bromley 20.1%, Stirling 20.1% and Salford 19.8%.

Paul Kenny GMB General Secretary said: ‘While we have seen a growth in the number of workers as the population has grown, average pay has simply not kept pace with inflation. Since 2008 the cumulative inflation has been 20.6%. During this period pay in the UK has gone up by 7% which has left the pay of the average full time worker in the region down by 13.6% in real terms.

‘This has had a deflationary impact on the economy and has also impacted on the tax take by the Chancellor to pay for essential public services. In the autumn statement the Chancellor predicted that the economy would grow steadily each year to 2020 when it would be 12% bigger than now. Workers in the UK will want to see that growth translating into pay rises above inflation to make up the lost ground.’