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JRF - Wage squeeze poses headache for new government

Helen Barnard, head of analysis at the independent Joseph Rowntree Foundation (JRF), responded to yesterday’s employment figures

It’s encouraging to see that employment levels continue to rise and unemployment has fallen again. But the troubling news for the government is the continued squeeze on wages for those are in work. This is the first time that there has been a year-on-year decrease in real total pay earnings since 2014.

“We have reached a tipping point where rising costs are outstripping earnings, leaving millions of just managing families in a precarious position. The election campaign paid precious little attention to the squeezed living standards of low income households and their prospects of finding secure, well-paid work.

“It means the new government must act to ease the strain by lifting the damaging freeze on tax credits and benefits, and prioritising plans to drive up pay and productivity across the country.”

View report: UK labour market: June 2017

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