Newspaper article The Evening Standard (London, England)

Pay Squeeze Puts Pressure on May; Living Standards of Families Fall for Sixth Month in Row Storm over Public Sector Wages but Good News on Jobs May Clashes with Corbyn on Public Sector Pay

Newspaper article The Evening Standard (London, England)

Pay Squeeze Puts Pressure on May; Living Standards of Families Fall for Sixth Month in Row Storm over Public Sector Wages but Good News on Jobs May Clashes with Corbyn on Public Sector Pay

Article excerpt

Byline: Nicholas Cecil, Joe Murphy and Kate Proctor

THERESA MAY was today hit by a growing row over falling living standards for millions of households and public sector pay restraint.

Official figures showed that average wages dropped by 0.5 per cent in July, once inflation is taken into account, raising the pressure on family budgets. It was the sixth month in a row that inflation has outstripped pay rises and the longest squeeze on living standards for three years.

Economists said a significant share of the blame fell on the Brexit vote in June last year, which sent the value of sterling plummeting, pushing up the cost of imports and making foreign holidays more expensive.

But there was good news as figures showed employment has hit another record high. The number of people in work rose by 181,000 to 32.13 million between May and July, the Office for National Statistics said. The employment rate also rose by 0.5 per cent to a record high of 75.3 per cent on the quarter.

Today Mrs May clashed with Jeremy Corbyn at Prime Minister's Questions over public sector pay. The Government yesterday lifted the one per cent pay cap first for police officers and prison staff but their wages will still rise less than the current rate of inflation. In the Commons, the Labour Continued on Page 4 Continued from Page 1 leader said: "Does the Prime Minister understand that inflation is now 2.9 per cent anything less means that dedicated public servants are worse off again."

He urged her to guarantee that the lifting of the pay cap for police and prison officers would not be funded by staff cuts. Mrs May refused but stressed that the pay review bodies were independent. She accused him of ignoring today's figures showing record employment, as well as automatic pay increases over and above the annual wage rises that many public sector workers get. …

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