UK wages have ‘stalled’ since 2008

The UK has seen 15 years of slow wage growth, leaving workers thousands of pounds worse off every year.

If pay had continued to grow at the pace seen before the 2008 financial crisis, the average employee in the UK would be earning £11,000 more per year than they do now. That’s taking prices into account.

The figures come from the Resolution Foundation, a think-tank which focuses on improving living standards for people on low to middle incomes.

The findings, shared exclusively with the BBC’s Panorama programme, also reveal a widening gap between typical household incomes in the UK compared with Germany. In 2008 the gap was over £500 a year, but now it is £4,000.

Torsten Bell, chief executive of the Resolution Foundation, said that the wage stagnation seen over the past 15 years is “almost completely unprecedented”.

“Nobody who’s alive and working in the British economy today has ever seen anything like this,” Bell told the BBC.

“This is definitely not what normal looks like. This is what failure looks like.”

Xiaowei Xu, senior research economist at the Institute for Fiscal Studies, said that the net result is an “absolutely massive difference in living standards” that ends nearly 60 years of consistent growth.

In the past year, millions of UK workers have also effectively had a pay cut as wages have failed to keep up with high inflation.