Five questions answered on longest real wages drop for 50 years

How long have real wages been dropping?

Figures from the Office for National Statistic (ONS) reveal real wages have experienced the longest consecutive drop for 50 years. We answer five questions on the drop in real wages.

How long have real wages been dropping?

They’ve been dropping consistently since 2010, which is the longest period of consecutive depletion since 1964, according to official figures. Overall, real wages have fallen by 2.2 per cent annually since the first three months of 2010.

How are real wages calculated?

Real wages are essentially wages that have been adjusted to factor in the cost of living or with inflation taken into account.

Why are real wages falling?

ONS said reduced output and shorter working hours were to blame. For example, many employees were asked to work shorter hours during the financial crisis rather than making them redundant.

The response to the fall in productivity in 2008 and 2009 was the main reason behind the fall in real wages, it added. It also highlighted the different inflation rate that exists between what is produced and what is consumed.

Are real time wages set to recover soon?

ONS said most recent figures, those released in the third quarter of 2013, showed real wages fell by a drop of 1.5 per cent compared with the same period a year earlier; showing that wages are still continuing to fall.

The Institute for Fiscal Studies produced a report on Thursday which also painted a strained picture. It suggested a mid-range household's income between 2013 and 2014 was 6 per cent below its pre-crisis peak. It added that real wages would not recover before the next general election.

What have the experts said?

"Over the last four years British workers have suffered an unprecedented real wage squeeze," said TUC General Secretary Frances O'Grady told the BBC.

"Even more worryingly, average pay rises have got weaker in every decade since the 1980s, despite increases in productivity, growth and profits. Unless things change, the 2010s could be the first ever decade of falling wages.

"A return to business as usual may only bring modest pay growth. We need radical economic reform to give hard-working people the pay rises they deserve."

For most people in Britain, wages have been dropping. Photograph: Getty Images.

Heidi Vella is a features writer for

Photo: Getty Images
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Stella Creasy targeted for deselection

Organisers on the left believe the Walthamstow MP is the ideal target for political, personal and geographical reasons.

Stella Creasy, the high-profile MP for Walthamstow and defeated deputy Labour leadership candidate, is the first serious target of an attempt to deselect a sitting Labour MP, the New Statesman has learnt.

Creasy, who is on the right of the party, is believed to be particularly vulnerable to an attempt to replace her with an MP closer to the Labour party’s left. Her constituency, and the surrounding borough of Waltham Forest, as well as the neighbouring borough of Leyton and Wanstead, has a large number both of new members, inspired either to join or return to Labour by Jeremy Corbyn, plus a strong existing network of leftwing groupings and minor parties.

An anti-bombing demonstration outside of Creasy’s constituency offices in Walthamstow – the MP is one of around 80 members of Parliament who have yet to decide how to vote on today’s motion on airstrikes in Syria – is the latest in a series of clashes between supporters of Creasy and a series of organized leftwing campaigns.

Allies of Creasy were perturbed when Momentum, the grassroots body that represents the continuation of Corbyn’s leadership campaign, held a rally in her constituency the night of the Autumn Statement, without inviting the MP. They point out that Momentum is supposedly an outward-facing campaign supporting Jeremy Corbyn and the Labour party towards the 2020 general election and the forthcoming local and European elections. Labour holds 27 out of 27 council seats in Creasy’s constituency, while Creasy herself has a majority of 23,195 votes.

“If you look at the seat, there is nothing to win here,” said one Labour member, who believes that Momentum and other groups are planning to depose Creasy. Momentum has denied any plot to remove Creasy as the MP.

However, Creasy has come under pressure from within her local party in recent weeks over the coming vote on bombing Syria. Asim Mahmood, a Labour councilor in Creasy’s constituency, has called for any MP who votes for bombing to face a trigger ballot and reselection. Creasy hit back at Mahmood on Facebook, saying that while she remained uncertain of how to vote: “the one thing I will not do is be bullied by a sitting Walthamstow Labour councilor with the threat of deselection if I don’t do what he wants”.

Local members believe that Mahmood may be acting as the stalking horse for his sister, the current mayor of Waltham Forest, Saima Mahmud, who may be a candidate in the event of a trigger ballot against Creasy. Another possible candidate in a selection battle is Steven Saxby, a local vicar. Unite, the recognized trade union of the Anglican Communion, is a power player in internal Labour politics.

Although Creasy has kept her own counsel about the direction of the party under Corbyn, she is believed to be more vulnerable to deselection than some of the leader’s vocal critics, as her personal style has led to her being isolated in her constituency party. Creasy is believed to be no longer on speaking terms with Chris Robbins, the leader of the council, also from the right of the party.

Others fear that the moves are an attempt by Creasy’s local opponents to prepare the ground for a challenge to Creasy should the seat be redrawn following boundary changes. The mood in the local party is increasingly febrile.  The chair of the parliamentary Labour party, John Cryer, whose Leyton and Wanstead seat is next to Creasy’s constituency, is said to fear that a fundraiser featuring the shadow foreign secretary, Hilary Benn, will take an acrimonious turn. Cryer was one of just four shadow cabinet ministers to speak against airstrikes in Syria.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.