Recession warning: Wages falling rapidly as economy shrinks
Fears have arisen that the UK could be in for a recession, here is what you need to know.
Post-pandemic, the UK economy has not grown as much as Brits would like to see. The economy shrank by 0.3 per cent in April.
In fact, experts are saying that as inflation is continuing to rise to dizzying heights, wages have fallen at the fastest rate for a decade.
Alice Haine, personal finance analyst at Bestinvest, told The Express: “In April, real wages declined on average by 2.2 percent compared to a year ago.
“It means the spending power of households is now severely compromised and with inflation expected to surge to 10 percent or higher in the fourth quarter – when Ofgem’s energy price cap increases to £2,800 – the situation will only get worse.
“For households grappling with higher food, fuel and energy bills along with the rise in the National Insurance tax, asking for a pay rise now may not be enough to ease the strain of the cost-of-living crunch.”
