Economics
U.K. Squeeze Tightens as Real Wages Drop Most in Almost 3 Years
- Inflation-adjusted earnings fall 0.6% in latest three months
- Hit to living standards adds pressure on premier Theresa May
Shoppers make their way along the central aisle at a Tesco Plc supermarket in Basildon, U.K., on Friday Dec. 1, 2015. .
Photographer: Chris Ratcliffe/BloombergThis article is for subscribers only.
The squeeze on U.K. households intensified in the three months through April as weaker wage growth inflicted the biggest loss of purchasing power in almost three years.
Average earnings rose 1.7 percent, the slowest annual pace since early 2015, the Office for National Statistics said on Wednesday. Taking inflation into account, they fell 0.6 percent, the largest drop since August 2014. Barclays said the situation will continue to worsen this year, while HSBC said the pressure on consumers will last longer than it previously anticipated.