The average annual earnings of full-time workers in the UK rose by 1.4% to £26,500 in the year to April 2012. The figures have been published by the Office for National Statistics (ONS) in its annual survey of hours and earnings. There was a cut in the real value of pay, however, as inflation was higher during the same period, at 3.5%.
The ONS data also reveals that inflation has outstripped the rise in average pay for the past 12 years. The survey results show that since April 2000, average annual pay for full-time workers has risen by 40%, from £18,848 to £26,500. In that time, inflation, as measured by changes in the retail prices index, has gone up by 43%.
However, the trend has accelerated in the past five years since the onset of the international banking and financial crisis and the consequent recession in the UK with the imposition of austerity measures by the government, despite improving current mortgage rates.
In just five years since April 2007, prices have risen by 18%, while average annual earnings have gone up by just 10%. That has left wages and salary increases lagging behind inflation by 8% in just five years.