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Tuesday, 4th February 2014

UK: An Examination of Falling Real Wages, 2010 - 2013

Source: Office for National Statistics (UK)

Introduction:

Economic activity in the UK fell considerably during the 2008-09 economic downturn. This put downward pressure on nominal wage rises at a time when price inflation picked up. Real wages have therefore fallen. For example, even if a person’s nominal wage remains unchanged, the effect of inflation implies that their income now buys fewer goods and services, resulting in a fall in their real wage.

This article outlines the historical interaction between nominal wages, inflation, and the resulting trends in real wages. The robustness of the fall in real wages is demonstrated by examining a variety of ONS measures of real wages, which all show falls since 2010. The article then explores some of the factors that may have affected real wages over the last few years.

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Having begun his career in academic libraries, Adrian Janes has subsequently worked extensively in public libraries, chiefly in enquiry work as an Information Services librarian. In this role he has had particular responsibility for information from both the UK Government and the European Union. He wrote a detailed report on sources for the latter which was published by FreePint in 2007, and has contributed articles to FreePint and ResourceShelf. He is involved in training in information literacy and the use of online reference resources.

A Contributing Editor to DocuTicker, he also write reviews for Pennyblackmusic.

Adrian can be reached at adrian.janes@freepint.com

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