TUC blames reduced hours for shrinking pay packets

6722573569_da026c6fbd_oA shift towards reduced working hours and part-time work is shrinking employees’ pay packets, the Trades Union Congress (TUC) has said.

The TUC said the UK’s overall pay packet was £52bn smaller last year than it was in 2007, despite a rise in unemployment. It blamed reduced hours; the failure of wages to keep step with inflation; and the loss of middle and well-paid jobs in the public sector for the fall.

The organisation added that total pay across some regional economies is down 10% and named the North West as the region suffering most dramatically with a 10.6% decrease. The South West, West Midlands and Scottish economies also saw falls of around 10%.

On the eve of the recession in 2007, the TUC said real wages for workers across the UK totalled £690bn in 2012 prices but this figure fell to £638bn last year.

TUC general secretary Frances O’Grady said: “Over the last five years, people have taken a massive hit in their pay packets, while millions more have had to reduce their hours or take lower paid work. Many people have lost their jobs altogether.”

She added: “Taken together, our pay and jobs crises have shrunk Britain’s total annual pay packet by more than £50bn. It’s no wonder businesses are struggling when so much demand has been sucked out of the economy. Employers and both local and central governments need to recognise the importance of decent wages in delivering sustainable economic growth. They can start by becoming living wage employers and being more transparent about their pay systems.”

The TUC has launched a campaign about wages: Britain Needs a Pay Rise http://www.tuc.org.uk/economy/britainneedsapayrise.cfm

Image credit: http://www.flickr.com/photos/68751915@N05/

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