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Household Incomes still at pre crisis level


The Institute of Fiscal Studies (IFS) has found that average household incomes are only at the same level that they were before the 2008 financial crisis, and are still more than 2% below their 2009/2010 peak.

Incomes for working age people are actually below the 2008 level, after adjusting for the impact of inflation. The report said that only people aged over 60 will have higher incomes this year than before the crisis. Living standards seem to be rising slower that after previous recessions, due to weak earnings growth, as well as tax and benefit cuts.

The IFS study uses figures from the Labour Force Survey, and from the government's independent forecaster, the Office for Budget Responsibility. One of the main reasons stated for the lack of growth is the UKs small productivity performance, meaning wage growth have been unaffordable.

IFS director Paul Johnson said:
"It's astonishing actually that seven years later incomes are still no higher than they were pre-recession and indeed for working-age households they're still a bit below where they were pre-recession”

Chancellor George Osborne has claimed that these figures marked a milestone in the countries recovery, but that it was not the end of the journey.

Cathy Jamieson, Labour's shadow financial secretary said the IFS' report "confirms that working people are worse off since 2010".
"We need a recovery that reaches kitchen tables across Britain, not one which has left working people worse off," she said.

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