Boris Johnson points to rising wages as evidence that voters in Britain will soon feel better off, despite rising prices
based on government forecasts that predate some of these changes suggests that total household income, after tax and corrected for inflation, will fall in both 2022 and 2023 . After two years in which household incomes fell because of the pandemic and Brexit, the result will be the longest decline since the mid-1970s.
The cut to universal credit, which unwinds a temporary increase at the beginning of the pandemic, at least featured in projections by the Office for Budget Responsibility , an official forecaster, when it last ran the numbers for household income in March. Since then the government has announced a 1.25% rise in both employer and employee payroll taxes, to take effect next April, in order to pay for social care and help clear a post-pandemic health-care backlog.
Such claims helped the prime minister win good headlines from his party’s conference. But in the longer term he may come to regret making higher living standards so central a measure of his success. As he emphasised in conference-season interviews, recent data on real wages has indeed been strong. According to the Office for National Statistics , real wages grew by 5.1% in the year to July.
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