Economic recovery? Only for a few. Wages are still lagging behind inflation. The average annual increase in wages is still onIy 1.0%, while prices (even on the conservative CPI measure) are going up about 2% per year.
Real wages (wage growth minus inflation) have been falling consistently since the end of 2009. It is certainly the longest squeeze since modern records began in 1964, and probably the longest since the 1870s.
Average house prices have risen, relative to wages, from five years’ worth to ten years’ worth, since 1997. As the Daily Mirror pointed out (11 February), wages would now have to double to make house-buying as affordable for workers as it was in 1997.
Rents have risen faster than wages, too — 10%, or 3.1% per year, between October 2010 and October 2013.
Unions should organise to seek real wage rises.