As increased growth forecasts and rising employment rates spread across the headlines of the mainstream press this week, a less publicised series of announcements told a different story.
They provide a stark reminder of where the main benefits of any growth in the economy are really going.
Capita Asset Services declared on Monday that shareholders should get ready for a record payout in 2014 – £101bn is heading their way in predicted dividend payments. That’s a bumper 27% increase on the 2013 payout.
In contrast, the next day the VocaLink Take Home Pay index revealed the changes in the value of wages over the last year. The take home pay of the average public sector employee has fallen by 1.8%, ratcheting up the pain for staff who have already seen the value of their pay packet cut by up to 16% since 2010.
Private sector manufacturing workers experienced a similar fall of 1.6% over the last year.
So while shareholders are pondering how to spend their £101bn, the outlook for ordinary workers doesn’t change.
RPI inflation is predicted to grow by 3.1% over 2014, while average pay settlements for the private sector are not expected to exceed 2% for the year ahead and the government seeks to enforce a 1% cap on public sector workers.
This pattern of rising prices cutting the value of pay packets has been going on every month since the government took office just under four years ago.
And the results were plain to see at the launch of Debt Awareness Week on Monday. The StepChange Debt Charity revealed that 15 million people in Britain are showing some sign of “problem debt.” That means that 31% of the total adult population are juggling or falling behind on essential household bills, borrowing to make it through to pay day, making just the minimum repayments on their debts, borrowing more to pay off existing debts or getting hit by late payments or overdraft charges.
UNISON assistant general secretary Karen Jennings commented: “This relentless assault on the living standards of employees, which has victimised public sector workers above all, has to be brought to a close.
“The government has run out of excuses – excuses for year upon year for a vicious pay squeeze, excuses for the scars that its policies have left on lives across the UK, and excuses for shutting ordinary workers out of the wealth that they create.”
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