Workers £8,500 worse off by 2021?

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workers wageWorkers in the UK are now £1,600 worse off on average compared to three years ago because the "dire" state of the economy has pushed down wages.

According to the Trades Union Congress (TUC), employees are just a quarter of the way through the UK's 12-year wage "dive" that will see such losses continue to mount in coming years.

By 2021, it predicts that real terms wage losses will reach £8,500, seriously affecting struggling families across the country.

Stretched

The research, which tracks wage and inflation data between 2009 and 2012, as well as forecasts from the Office for Budget Responsibility from 2012 onwards, revealed a sharp fall in incomes in real terms over the last three years as wages have failed to keep up with the rising cost of living.

Many households across the country already have trouble paying their bills due to large monthly outgoings, and any loss in wages would see family budgets stretched even further, perhaps beyond breaking point.

TUC general secretary Brendan Barber said: "Even when wages start to pick up again it will take years to undo the damage wreaked by austerity and high inflation.

"Ordinary workers did not benefit enough from the proceeds of growth in the run-up to the crash as profits were hoarded by shareholders and top executives. A return to business as usual will simply postpone the next living standards crisis.

"It is clear that austerity isn't working. We need a new economic approach that delivers for all workers and their families."

Tax credits

Mr Barber added that families who receive tax credits will be hardest hit by the loss of income.

Tax credits, like Working Tax Credit and Child Tax Credit, provide families with an important source of extra income. They are payments from the Government aimed to help people on low income, or those with lots of mouths to feed.

However, many people miss out because they fail to claim their full entitlement, or they simply aren't claiming at all.

With wages seemingly on the decline, it is important to find out if you and your family could benefit from such payments.

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