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Monday, 30 January 2012

Workers today earning far less than 30 years ago

A recent findings by Union news Uk and the TUC. have shown some stark figures of how pay for workers is going backwards for many workers. While pay for the top 10% zooms ahead.
Workers today are taking home less than workers did 30 years ago, according to a new report published today by the TUC.

The finding is published in the latest TUC Touchstone Extra pamphlet All In this Together? which looks at how the recession and ongoing economic weakness has had an impact on different parts of the workforce.

All in this Together?, written by author and academic Stewart Lansley, documents the scale of the real terms pay cuts and downgraded terms and conditions that employees are facing, and warns that UK workers are at risk of a near-permanent lowering in the pattern and nature of their working conditions, with disastrous potential consequences for our future economic health.

The report shows that earnings took a sharp hit during the recession – dropping from an average increase of 4.2 per cent in 2007 to just 1.7 per cent in 2009 – and there has been no post-crash rebound. In September 2011, nearly two years on from the end of the recession, 99 per cent of pay deals were below RPI inflation – the measure most commonly used in setting pay.

At the same time the pay gap between executives and their staff has continued to widen, the report shows. While in 2000 the ratio of FTSE 100 top executive to typical employee pay stood at 47:1, by 2011 it had risen to 102:1.

But while poor earnings growth and increasing earnings inequality has been well-publicised in recent years, All in this Together? also shows that the UK’s total wage pool has been shrinking for more than three decades.

In 1978, the total UK wage bill represented 58 per cent of GDP. By 2011 this ‘wage-output’ ratio had dropped to 53.8 per cent. The 4.2 per cent fall in wages as a share of national output means that UK workers took home £60bn less in 2011 than if the wage-output ratio had stayed at 1978 levels. Cumulative wage losses over the last three decades are approximately £1.3 trillion.

The falling share of wages as a proportion of national output has contributed to the rising household debt, plastered over in good times by a housing boom and easy access to credit, that helped to cause the recent financial crash, says the TUC.

The falling wage share has been particularly acute for those on low and middle incomes. The wages of the poorest fifth of workers in 2011 are 43 per cent lower than they would have been if the wage share had not fallen since 1978 and the distribution of earnings had not been skewed towards higher earners. Workers on middle incomes have experienced a 36 per cent wage loss, while the richest fifth of earners have had a wage loss of just six per cent.

The only group of workers immune from the UK’s shrinking wage pool have been top execs who have weathered the recession and stock market falls to receive median pay increases of 10 per cent in 2010 and 17 per cent in 2011.


This has been something we marxists have known all along that despite teh so called boom years in the 2000's average wages for the lowest paid workers stayed the same and in some cases went backwards. The gap between rich and poor widened even in the boom times. So while many got on and improved their situation many didnt and this is down to the fact capitalism and its blind drive for profit crushed workers wages to increase their profits at the top. More millionaires than ever before as a result.

The gap between rich and poor is a social issue too the wider the gap the more social issues we face of deprevation, riots and crime all increases. They are not the only reasons but have a hell of a lot to do with it.

Workers wouldnt be so angry if they had had a bit more of the share of the wealth but the slogans of the 99% and the 1% could not be clearer today in showing the social and economic gap in wealth in society.

Capitalism exists on the basis of wage labour without wage labour it could not exist so could tackling the wage gap be a bridging demand to a more equal society ending the use of boss's in place of workers committees being paid no more than a average skilled worker. Being subject to immediate recall if a vote of no confidence is held up

It is shown a more equal society is one where the wage gap is smaller a society where there is no gap is what i'd want to see one day, fairness for all not just some.

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