UK among EU nations with largest decline in wages

Wages in the UK fell sharply during the economic downturn, in one of the largest declines in the EU, official figures showed.

The figures, that had been requested by the Labour Party and collated by the House of Commons library, showed average hourly wages were down 5.5 per cent since mid-2010, adjusted for inflation which came as the fourth-worst decline among the 27 EU nations.

German hourly wages in contrast were up by 2.7 per cent over the same period.

Across the EU as a whole, average wages were down 0.7 per cent.

Only the hourly wages of Greek, Portuguese and Dutch workers had declined, the figures showed.

Other countries that had suffered during the eurozone debt crisis also fared better than the UK, with figures for Spain dropping 3.3 per cent over the same period and salaries in Cyprus down by 3 per cent.

French workers saw a rise of 0.4 per cent, while the 18 eurozone countries saw a 0.1 per cent drop during that period.

According to shadow treasury minister Cathy Jamieson, the figures showed the full scale of David Cameron's cost of living crisis.

According to Jamieson life was getting harder for ordinary families, as prices continued rise faster than wages. She attacked David Cameron and the chancellor for having failed badly over the past three years with the people paying a heavy price.

According to professor John Van Reenen, director of the Centre for Economic Performance at the London School of Economics, the   fall in real wages in the UK was "stunning - and something that did not happen in previous postwar recessions in Britain".

He added, the weak performance reflected poor growth. He linked it to falling GDP and national income, which now stood 3.5 per cent smaller than it was prior to the financial crisis.

Van Reenen added, Labour had rightly pointed out that if the government had pursued better policies, such as not cutting investment dramatically since 2010, then growth would have been better and living standards higher.

Labour's renewed focus on the economic fallout from the UK's poor growth came in marked contrast to the claims of treasury secretary, Sajid Javid, that the UK economy had "regained momentum" and a full-blown economy recovery was now under way in the UK.