O’Grady: Workers facing “longest and harshest” wage slump in modern history

Frances O’Grady has warned that workers are suffering the “longest and harshest squeeze” on wages in modern history after research revealed that the average worker lost nearly £20,000 in real earnings between 2008 and 2021.

The analysis from the TUC, published on Saturday, found that workers are earning more than £60 a month less than they were at the start of the financial crisis in 2008.

The TUC general secretary said: “Everyone who works for a living deserves to earn a decent living. But UK workers are suffering the longest and harshest squeeze on their earnings in modern history.

“This has left millions without a safety net as bills and prices skyrocket. If we don’t get pay rising across the economy, we will just keep lurching from crisis to crisis. This cost-of-living emergency has not come out of the blue. It is the result of more than a decade of standstill wages.”

The TUC used Bank of England data to compare the current earnings squeeze with other major wage crises in the last 200 years. It found that the current squeeze is the longest since the Napoleonic Wars in the early 19th century, when it took 24 years for real wages to recover.

The data suggests that earnings took a decade to recover following the Great Depression of the 1930s and seven years after the Second World War.

The TUC estimated that the average worker has missed out on £19,600 in real earnings since the financial crisis as a result of inflation outstripping pay, the “biggest total real wage loss since the 1830s when Queen Victoria took the throne”.

The union body found that real wages will fall by more than £500 this year on average but that public sector workers will experience a greater hit to their earnings.

Its analysis found that nurses’ pay will fall by as much as £1,600 in real terms this year if ministers introduce a 3% pay settlement. The same settlement would see paramedics’ pay drop by £2,000, while hospital porters’ pay would fall by £1,000.

O’Grady accused Boris Johnson of having “cynically abandoned” his commitment to a high-wage economy, saying: “He and other ministers are treating workers like Oliver Twist by telling them not to dare ask for a decent pay rise. The last thing we need right now is for wages to be held down.”

The TUC urged working people from across the country to join its mass demonstration in London on Saturday. The rally demanded a “real pay rise” and a real living wage for every worker.