Business

Real earnings have fallen back to their 2002 levels

Image copyright PA
Image caption Real incomes have fallen once again, ONS figures show

The weekly earnings of full-time workers in the UK fell, in real terms, each year between 2008 and 2013, official figures show.

The Office for National Statistics (ONS) says in cash terms earnings grew, by only 2% a year, from 2009 to 2013.

But after taking inflation into account the purchasing power of those earnings suffered an overall fall of 8%.

This means that the real value of the UK's average weekly earnings are now back to the level of 2002.

The ONS said this retrenchment of real earnings was due to the impact of the banking crisis and subsequent economic downturn.

"This adjustment [for inflation] reveals that weekly earnings for full-time employees increased steadily by 24% overall between 1997 and 2008, peaking at £561," the statistics agency said.

"Subsequently, weekly earnings decreased every year, by 8% in total, so that in April 2013 they were similar to the level seen in 2002."

Gender gap widens

The ONS report is based on data from the Annual Survey of Hours and Earnings (ASHE), which in turn derives its figures from a 1% sample of the tax records of all employed people in the UK.

Image copyright PA
Image caption Public sector workers are generally better educated so they tend to earn more than the private sector

Other findings in the report were that:

  • the gap between the earnings of full-time male and female workers has narrowed considerably since 1997, when it stood at 17.4%
  • but that gap widened slightly, from 9.5% to 10%, between 2012 and 2013
  • part-time women workers earn a higher hourly rate of pay then their male counterparts, a consistent trend over the past 15 years
  • overtime, bonus and shift payments have shrunk as a proportion of gross pay, mainly due to a reduction in the amount of overtime being worked
  • workers in the public sector still earn more than those in the private sector, partly due to the higher proportion of jobs requiring a university education
  • staff in sales and customer service are still the lowest paid
  • the median level of full-time earnings in 2013 was £517 per week
  • the bottom 10% of employees earned less than £287 per week, while the top 10% earned more than £1,020 per week

"Each year since 1997, earnings at the 90th percentile have remained consistently at around 3.5 times that of the 10th percentile," the ONS observed.

Only 1.1% of all jobs - 279,000 - were recorded as being paid below the national minimum wage in April last year, a proportion which the ONS said had remained "fairly constant" for several years.

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