Real pay down 8% since 2008 - why workless can't afford jobs

Thu, 27/02/2014 - 14:25 -- nick

Real earnings have fallen by 8% since the start of the recession in 2008 according to an influential survey of pay and work.

This shock finding was revealed by the Office for National Statistics (ONS) today, helping to show why unemployed people often cannot afford to take the jobs they are offered.

It also shows why those in work can resent unemployed people - they have been getting poorer for so long that the idea of a benefit cap set at the level of average earnings appears to be fair.

The government has been quick to exploit this resentment; along with the benefit cap, its 1% annual benefit rise matches wage increases but has the effect of making both low wages and welfare unliveable for many.

In a further blow to social justice, the gap between the pay of men's and women's pay has started to rise again after years of falls due to huge payrises being awarded at the male-dominated top of companies.

Wages were at their 2002 level in 2013, meaning there has been no progress on living standards for 11 years.

The ONS puts the blame for this at the door of the banking and wider financial crisis, although it appears in part to be the result of profitable companies seizing the opportunity to take money from its lower-paid workers to give to directors and higher earners.

The minimum wage law has not proved truly robust as 279,000 jobs last year were still paid below this level.

The campaign to implement the living wage for all - currently £8.80 in London and £7.65 outside it - provides a potential route out of poverty for those in low paid work and those trying to get into it, but the coalition has not agreed to support it.

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