Highest rise in household debt in 20 years seen as wages stagnate
09 January 2017 New research by the Trades Union Congress (TUC) has found that household debt is increasing due to a lengthy stagnation in wages and increasing inflation.
09 January 2017
New research by the Trades Union Congress (TUC) has found that household debt is increasing due to a lengthy stagnation in wages and increasing inflation.
Unsecured debt rose by £1,117 per household in the year leading up to the third quarter of 2016 – the highest annual increase since at least 1997.
TUC General Secretary Frances O’Grady said: ““Employment may have risen, but wages are still worth less today than nine years ago. The government is relying on debt-fuelled consumer spending to support the economy, with investment and trade in the doldrums since the financial crisis. There’s a lot the government could do to help.”
Indeed, the Institute of Employment Rights addresses the issue of low wages in our Manifesto for Labour Law – 25 recommendations for the reform of employment legislation, now adopted by the Labour Party. Our overarching aim is to shift the focus of labour law to collectively agreed wages and conditions at a sectoral and enterprise level, rather than relying on statutory minimums that give employers a floor to aim for and which they can effectively avoid through the use of insecure contracts. Our proposals will put upwards pressure on wages and conditions, thereby improving the income of the lowest-paid workers and stimulating economic growth without the need for increasing consumer debt.
