Legacy of the Tories: living standards suffer first five-year fall on record
The TUC analysis uses official data from the Office for National Statistics (ONS). It compares five-year averages of UK real disposable household income per head with the averages for the preceding five years.
The five-year period from 2010 to 2014 is the only one in at least half a century during which real disposable household income per head actually fell, instead of growing, compared to the preceding five years (2005-09).
Even for the period 2008 to 2012, which most closely correlates to the financial crisis, there was a rise of 1.5 per cent on the preceding five-years (2003-07).
The TUC says this provides further evidence that the government’s austerity programme, which began in 2010, is more to blame for the loss of living standards than the financial crisis that preceded it. The government’s deep and rapid cuts killed off the recovery, causing growth to flat-line and wages to remain in decline for years longer than official forecasts.
TUC general secretary Frances O’Grady said: “Living standards have suffered the worst slump in at least half a century, leaving workers paying a heavy price for the government’s bad choices over the last five years. Austerity has failed, there’s still a major deficit, jobs are less secure and workers’ living standards have fallen.
“We need a government that understands how important pay growth and secure jobs are for a strong economy. If workers don’t have decent wages in their pockets to spend, businesses will struggle to invest and grow.
“Conservative plans for extreme austerity after the election risk killing off the recovery again. It would be Groundhog Day for living standards, making families worse-off and cutting public services down to a stump.”