(qlmbusinessnews.com Fri. 28th June, 2024) London, UK —

UK Household Incomes Stagnate Over 14 Years, Reports Think Tank.

According to a new report by the Resolution Foundation, slow economic growth and three significant economic shocks have resulted in very modest increases in household disposable incomes since 2010. The think tank's analysis revealed that typical household incomes have risen by just £140 annually over the past 14 years, translating to a total increase of only 7%—an average of 0.5% per year—after taxes.

In stark contrast, disposable incomes rose by 38% in the 14 years leading up to 2010. However, the report highlighted that poorer households experienced stronger income growth compared to wealthier ones.

The Resolution Foundation attributed the slowdown to the 2008 financial crisis, the Covid-19 pandemic, and high inflation, noting that overall economic growth has been “sluggish.” This stagnation in income growth has hindered efforts to reduce poverty levels.

The state of the economy and the impact of the cost-of-living crisis on ordinary families have become central issues in the general election, with the Conservatives defending their record since 2010. The think tank's analysis indicated that poorer households saw the most significant growth in disposable incomes, partly due to the robust UK jobs market. One-off cost-of-living payments last year also contributed to these gains.

UK Household Incomes

Despite these gains, the report found that regressive tax and benefits policies largely offset them, resulting in a 13% overall increase in disposable incomes for the poorest households. In contrast, the wealthiest households saw only a 2% income growth over the same period.

Data from Eurostat, covering a similar period from 2007 to 2022, suggested that the UK has fared worse in terms of disposable income growth compared to several leading European countries, including the Netherlands, France, and Germany. “While global economic shocks have been a major factor, Britain’s recent record is poor compared to both its own history and many of our European neighbours,” said Lalitha Try, an economist at the Resolution Foundation.

The report, titled *Hard Times* and funded by the Nuffield Foundation, utilised data from the Department of Work and Pensions alongside information on jobs, pay, and housing costs. It found that absolute poverty has decreased by 3.6 percentage points since 2010, although it had fallen by 14 percentage points in the 13 years prior to 2010. While relative poverty levels remained stable over the last 14 years, the number of children in large families living in poverty increased, whereas those in small families living in poverty decreased.

Political parties have been asked to respond to the findings of the report.

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