doom and gloomier

British families are on average £910 worse off than they were two years ago. Rising food, clothing and energy prices mean the average British family will have £910 less to spend this year than they did in 2009.The squeeze - which is considered the worst in peacetime for 90 years - is set to continue with a two per cent fall in household disposable income this year. The fall in disposable income is comparable with the savage post-World War One recession which lasted between 1919 and 1921, as a result of a collapse in manufacturing and international trade. The findings also show the fall in household disposable income is sharper than in the 1930s depression.

The Centre for Economics and Business Research forecasts inflation will average 3.9pc in 2011. At the same time, salaries will rise just 1.9pc as unemployment remains high and the public sector makes cut-backs.

Employment lawyers have predicted that older workers and pregnant women will be hit by a fresh wave of job cuts. Paul Griffin, head of employment at DBS Law, said: "The growth of discrimination claims from older workers and pregnant women suggests that employers are now targeting their more expensive staff, despite them being in protected groups. Obviously mistakes are being made in companies as accounts departments win out against human resources."