Earnings growth at record low, says trade union
05 Sep 2014
The Trades Union Congress (TUC) has released a report showing that changing trends in employment have had a detrimental effect on earnings growth.
A combination of rising under-employment and a shift from higher to lower paying industries were cited in the report, which examined average weekly earnings growth published by the Office for National Statistics (ONS).
The changing composition of the labour market has meant that low-paying sectors have created jobs, whereas high-paying sectors have greatly reduced the number of jobs over the past five years. Likewise, there has been a shift from full-time to part-time work, with many people struggling to get more hours in their current job. Under-employment of this kind, the TUC says, has reached a record 3.4 million this year.
One notable shift has been that young people appearing on official data for the first time (i.e. reaching employment age) are earning 3.9% less than those who left employment the previous year and no longer feature in official data.
The two lowest-paying industries – the food/drink and building/landscaping services – saw an approximate 25% increase in jobs over the last five years. Meanwhile financial services – the highest paying industry in the UK – saw a drop in jobs of around 20% in the same period.
TUC General Secretary, Frances O’Grady, said: ‘The economy is growing and employment is rising, but wages are still falling across Britain.
‘Pay settlements are barely keeping up with the cost of living. We know that many employers can and should be paying their staff more’.