The Tories have been accused of “losing control” of the economy as fresh statistics show real-terms pay has fallen by a record 3%.
Figures from the Office for National Statistics paint a bleak picture of a deepening cost of living crisis when adjusted for inflation between April and June.
Regular pay has slumped by the fastest decline since records began in 2001, the statistics show, as prices continue to rise.
Inflation has only just hit a new 40-year record of 9.4% in June and is expected to peak at around 11% later this year, hammering families already facing the cost of living squeeze.
Shadow Climate Change Secretary Ed Miliband described said the fall in workers’ pay as a “very grim moment”.
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Wiktor Szymanowicz/REX/Shutterstock)
The Resolution Foundation think tank insists the fall in real average weekly earnings marks the biggest fall since 1977.
Nye Cominetti, senior economist at the Resolution Foundation said the scale of the pay fall “is even deeper than official figures suggest, as pay growth estimates are still artificially boosted by the effects of the furlough scheme last year”.
The unemployment rate between rose 3.8%, but hiring demand is still slow as the job vacancies have fallen by 19,8000 within the same period.
Chancellor Nadhim Zahawi attempted to paint a positive picture, claiming the jobs market is in a “strong position”.
But in reality, families are facing a deepening cost of living crisis with soaring energy bills and plummeting real wages.
Jonathan Ashworth, Shadow Work and Pensions Secretary said: “Today we see yet another record fall in real wages, and further proof that the Tories have lost control of the economy.
“Because of the Tories’ failure on the economy, families face plummeting real wages and soaring energy bills.
“Yet, this Zombie Government is offering no solutions to the cost of living crisis.”
Liberal Democrat Treasury Spokesperson Sarah Olney MP said: “Families are being hammered by a cost of living catastrophe and yet the Government is nowhere to be found.
“This Zombie Government has no plan and is failing our country. People can’t wait any longer for the Conservatives to play out their horror show leadership contest.”
TUC General Secretary Frances O’Grady said “millions of working families are worried they won’t be able to keep their heads above water this winter”.
“We need action from ministers now,” she added.
“They should cancel the increase to the energy price cap. And they must do far more to get pay rising – starting with boosting the minimum wage this autumn and giving public sector workers a decent pay rise.”
Mr Zahawi added: “Today’s stats demonstrate that the jobs market is in a strong position, with unemployment lower than at almost any point in the past 40 years – good news in what I know are difficult times for people.
“This highlights the resilience of the UK economy and the fantastic businesses who are creating new jobs across the country.”