Families are £11 a week worse off than they were last year as the cost of living increases at twice the pace of wage growth, research has indicated.
A typical family had only £169 a week left over after meeting all essential costs during February, down from £180 in the same month of 2010. It was the 14th consecutive month during which people suffered a year-on-year fall in their disposable income.
Pay before tax rose by just 2.2% in January, the latest month for which figures are available, but Consumer Prices Index inflation was double this at 4.4% in February.
Charles Davis, managing economist at the Centre for Economics and Business Research, said: "The rising cost of essential goods such as petrol and food stuffs continues to place pressure on households across the country, compounded by weak earnings growth and concerns about job security. The labour market recovery is still not yet convincing. Public sector job losses this year, which appear to be occurring at a faster rate than the Government initially expected, are likely to lead to a significant squeeze on the incomes of many households. Public sector workers still in employment will be affected by a two-year freeze for those earning above £21,000, coming into effect from April."
The Socialist Party
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