Business

Pay for under-40s is 11% lower than in 2008, says report

Sterling coins and notes Image copyright Getty Images

Typical hourly pay for the under 40s is at least a tenth lower than before the 2008 financial crisis, according to a report from the Resolution Foundation.

Real hourly pay for 22 to 39-year-olds was down by 11% on its peak, compared with 5% for workers in their 50s and 2% for those in their 60s, it added.

And it said average weekly earnings fell 0.4% in the first quarter of 2017.

Part-time workers' pay was the only area where typical earnings had returned to pre-2008 levels, it added.

'Bright spot'

The Resolution Foundation, which says it is "non-partisan", was founded in 2005, with "the goal of improving living standards for the 15 million people in Britain on low and middle incomes".

"The pay squeeze made an unwelcome return at the start of 2017 and looks set to stay with us for the rest of the year at least," said Stephen Clarke, economic analyst at the foundation.

"What's most worrying is that people's pay packets still haven't recovered from the last squeeze when this latest bout of falling pay hit."

However the foundation said that the impact of the National Living Wage had been positive since it was introduced two years ago.

"The National Living Wage has been a bright spot amidst this bleak picture on pay, delivering a 12% rise over the last two years," it said.

In response to the report, a spokesman for HM Treasury said: "There are more people in work than ever before and we are helping people to keep more of what they earn by cutting taxes for millions of working people.

"The National Living Wage has given a pay rise of £1,400 a year to those on the lowest wages, and we are helping people's money to go further by freezing fuel duty and doubling the amount of free childcare. "

Find out if your wages are keeping up with inflation

Enter your details below. Source, Office for National Statistics.

More on this story