Analysis20 Helmi 2012

Profits Before Pay

It may come as no great surprise that many of us have experienced a wage squeeze, while the cost of living has gone the other way, since the financial crisis of 2008. However, as Duncan Weldon, a senior economist at the Trades Union Congress, points out, wages for most people in the UK began stagnating years before the crisis.

We tend to think of the early 2000s as a time of relative wealth: house prices were rising, credit flowed easily, the government introduced a generous tax credit scheme and people generally felt better off. But Duncan Weldon argues these masked the reality of what was going on.

Work done by the think tank The Resolution Foundation, which focuses on those on low and modest incomes, shows that there was almost no wage growth in the middle and below during the five years leading up to 2008 and yet the economy grew by 11% in that period. Others also point out that the share of the national income which goes into wages, as opposed to profits, has been decreasing since the mid-1970s. The argument is that less of the economic pie is going into the pockets of ordinary workers.

What is also clear is that a disproportionate amount of the economic wealth has been going to those at the top. The earnings of the richest few per cent have increased rapidly in the UK since the 1980s and that pattern accelerated in the last ten years. In the United States that process began earlier and has been more extreme.

Some economists argue that this is not a problem in itself as taxation, for example, helps to re-distribute the money to the less well off or those with disadvantages.

In Analysis Duncan Weldon asks why wages stopped rising in the years before the crash and what was the driving force for the squeeze?

Kokeile Premiumia

Nauti 14 päivää ilmaiseksi

Tilaa Premium

Jaksot(389)

The low pay puzzle

From April, 2.7 million workers will get one of the biggest pay rises in UK history as the National Living Wage rises to £11.44 an hour. But will they feel better off?It's 25 years since the National ...

25 Maalis 202429min

How real is the existential threat from AI?

The existential threat caused by Artificial Intelligence is a popular theme in science fiction. But more recently it’s started to be taken seriously by governments around the world and the companies d...

18 Maalis 202429min

What would Isambard Kingdom Brunel have done?

It's 2024, and the Manchester extension of HS2 has been cancelled. The leg to Leeds was cancelled in 2021. The remaining line to Birmingham is now less than half the initial planned route, and will co...

11 Maalis 202428min

Power Drive

It's widely believed that the Conservaives won the Uxbridge by-election because of motorists who were annoyed by the London mayor's ultra low emission zone. With a general election looming, both main ...

4 Maalis 202428min

How to cure the small town blues

Middlesbrough, in the north-east, is one of the most deprived towns in England. Once a steel and shipbuilding powerhouse, its fortunes changed when those industries closed down. Today, the town that G...

26 Helmi 202428min

How to Dismantle a Democracy

Democracies do not die in military coups. They are dismantled slowly, by libel laws, through tax audits, and procedure. Democracies are dismantled by bureaucrats and judges, not by soldiers and heavy-...

19 Helmi 202428min

What is 'British culture'?

'What is "British Culture?” I was born in the UK and have lived here for 40 years, and yet, as a British Asian person, I am constantly told “we are not integrating”. Not integrating into what culture ...

12 Helmi 202428min

Has the family had its day?

British politicians love to invoke the family, from John Major's "Back to Basics" campaign, to New Labour's "hardworking families" - and now a prominent strain of the Conservative right says parents s...

5 Helmi 202428min

Kaikki yhdessä sovelluksessa

Kuuntele kaikki suosikkipodcastisi ja -äänikirjasi yhdessä paikassa.

Sinulle valikoitua sisältöä

Podme-sovelluksessa kokoat suosikkisi helposti omaan kirjastoosi. Saat meiltä myös kuuntelusuosituksia!

Jatka kuuntelua koska tahansa

Voit jatkaa siitä mihin jäit, myös offline-tilassa.

Premium

9,99 €/kk

Kaikki premium-podcastit
Ei mainoksia
Ei sitoutumista, peruuta koska tahansa

Aloita 14 päivän kokeilu

Premium

13,99 €/kk

Kaikki premium-podcastit
Ei mainoksia
Ei sitoutumista, peruuta koska tahansa
Yksi lisäkäyttäjä

Kokeile 14 päivää maksutta

Suosittua kategoriassa Politiikka ja uutiset

rss-polikulaari-humanisti-vastaa-ja-muut-ts-podcastit

rss-tasta-on-kyse-ivan-puopolo-verkkouutiset

Tarinat ja äänet, joita rakastat kuunnella

Kuuntele kaikki suosikkipodcastisi ja -äänikirjasi

Lue lisää