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UK faces two decades of no earnings growth, IFS warns

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    UK faces two decades of no earnings growth, IFS warns

    Dear me -

    Flee - save yourselves!


    Thinktank says budget shows uncertainty and loss of productivity could put wages below their 2008 level in 2022

    Phillip InmanLast modified on Thursday 23 November 2017 16.00 GMT
    Coins, notes and bank cards
    The IFS said that despite the budget allocating more cash to the NHS, it was ‘not even nearly the end of austerity’. Photograph: Yui Mok/PA
    The UK is in danger of suffering two decades of zero earnings growth as it struggles to cope with uncertainty and a loss of productivity, the Institute for Fiscal Studies has warned.

    The thinktank said a downgrade in productivity and average wages for the next five years by the Treasury’s official forecaster, the Office for Budget Responsibility (OBR), would lead to an unprecedented period of flat earnings growth.

    Paul Johnson, the IFS director, warned that the impact on the public finances would be to extend the time the chancellor needs to take to bring the deficit down, and limit his scope to ease the pressure on welfare and public services.

    Q&A
    What is productivity and why does it matter?

    While the NHS was due to receive a funding increase, the government’s main austerity plans were still in place, he said.

    This is not the end of austerity. It is not even nearly the end of austerity. There are still nearly £12bn of welfare cuts to work through the system, while day-to-day public services spending is still due to be 3.6% lower in 2022-23 than it is today.”

    To keep public services spending per head constant over the next five years would require a budget increase of £13bn more to 2022-23 than currently planned, he added.

    In forecasts to accompany the budget, the OBR said it expected GDP growth to remain below 2% for the next five years given the weaker outlook for productivity and wages.

    “The immediate effects of all this on households are already being felt. Real earnings are falling this year as inflation has risen to 3%. The nascent recovery in earnings, which were growing through 2014 to the first half of 2016, has been choked off. That they might still be below their 2008 level in 2022 as the OBR forecast is truly astonishing. Let’s hope this forecast turns out to be too pessimistic,” Johnson said.

    Earlier this month, the IFS said welfare cuts already in the pipeline affecting households with young families would mean the number of children living in poverty soaring by 1 million to a record 5.2 million over the next five years.

    The IFS said freezing benefits, the introduction of universal credit and less generous tax credits would mean a surge in child poverty and the steepest increases would be in the most deprived parts of the country, reversing the progress made over the past 20 years.
    source
    "Never argue with stupid people, they will drag you down to their level and beat you with experience". Mark Twain

    #2

    Comment


      #3
      Originally posted by DimPrawn View Post
      Are you still holding out for the secret weapons to save you before the Soviet tanks break through?

      Comment


        #4
        If the worst we see is stagnation of earnings brought on by globalisation then I think we are doing OK.

        My personal opinion is the next 10 - 15 years is going to be a total nightmare as automation increases.

        Comment


          #5
          DIM's automated cUK posting robot began a few years ago. True...
          "Never argue with stupid people, they will drag you down to their level and beat you with experience". Mark Twain

          Comment


            #6
            Originally posted by bobspud View Post
            If the worst we see is stagnation of earnings brought on by globalisation then I think we are doing OK.

            My personal opinion is the next 10 - 15 years is going to be a total nightmare as automation increases.
            More jobs for IT people.....

            Comment


              #7
              Originally posted by BrilloPad View Post
              More jobs for IT people.....
              Only the ones who know how to automate.

              In my experience most IT people are ****wit luddites without the imagination to realise that IT is all about making humans redundant.
              See You Next Tuesday

              Comment


                #8
                Originally posted by BrilloPad View Post
                More jobs for IT people.....
                India will be the richest country on the planet 100x over. Our govt will see to that...

                Comment


                  #9
                  Originally posted by Lance View Post
                  Only the ones who know how to automate.

                  In my experience most IT people are ****wit luddites without the imagination to realise that IT is all about making humans redundant.
                  The human race has not got more than 100 years left. Robots will follow us.

                  Comment


                    #10
                    Originally posted by DimPrawn View Post
                    India will be the richest country on the planet 100x over. Our govt will see to that...
                    Unless we can arrange them to have a nuclear war first. Preferrably with China....

                    Comment

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