Only half of UK employees believe wage increases are keeping up with the cost of living, according to research by the Work Foundation at Lancaster University.
Its survey of almost 4,000 workers found that 42% of respondents earning less than £25,000 per annum said their pay kept up with the cost of living, compared to 73% of those earning over £60,000 a year.
Overall, two-fifths (43%) of respondents said they expect an above inflation pay rise in the next 12 months, while 24% of 55 to 64-year-olds said they were expecting an above inflation increase.
Additionally, one in six said they struggle to pay their bills each month, and two-fifths have little income left for savings or holidays.
The study also highlighted that, due to years of wage stagnation and the cost-of-living crisis, wages still do not cover basic living costs for many. It also looked at data from the Office for National Statistics, which revealed that 1.35 million people have second jobs, an increase of 121,000 on the previous year and the highest level since records began in 1992.
Ben Harrison, director of the Work Foundation at Lancaster University, said: “Raising living standards is not just about figures on a spreadsheet, it’s about workers feeling more financially secure. Four years on from the start of the worst cost-of-living crisis in a generation, our analysis shows workers continue to feel the impact of nearly 20 years of stagnating pay packets.
“Prices may not be rising at such rapid rates now, but these survey results reveal many workers continue to struggle with day-to-day costs, and have fears for their financial future. The government has prioritised increases to the national living wage and set out an ambitious agenda to strengthen workers’ rights and make work pay. But with many reforms to boost access to better paid and more secure work still years from implementation, there is a real risk that change comes too late for those struggling today.”
