10 ms·

UK pay falls at fastest rate on record as inflation hits

94 points by saos 4y ago

jjgreen 4y ago
... and the real rate of inflation, RPI, is at 11.7%
- dave4420 4y ago
  Meh. There’s no single real rate of inflation. Different methods of measuring inflation have their pros and cons. Meanwhile, neither RPI or CPI try to track increases in the cost of living.
  - gruez 4y ago
    >Meanwhile, neither RPI or CPI try to track increases in the cost of living They don't? What are they tracking then?
    - iso1631 4y ago
      They are tracking the price of an arbitrary basket of goods which is going to be different to your personal basket, as is required. The increase in the cost of living for someone who drives 20,000 miles a year will be different to that of someone who gets a train to work to that of someone who works from home to that of a pensioner with a small amount of money to a pensioner with a large amount of money
      - swores 4y ago
        You're describing the method they used to try to (roughly) "track the cost of living". You can argue that it is or isn't doing a good enough job in terms of the choices made but that's specifically what it's doing (and while it may not be doing it well enough, it obviously does need to be done based on sampling not based on producing an exact % for each individual that the things they bought over the past year have increased). (You're not the person who wrote "neither RPI or CPI try to track increases in the cost of living", but that's the context of this comment chain.)
    - dave4420 4y ago
      They’re tracking the value of money. RPI/CPI aren’t only tracking the prices paid, but also the quality of goods exchanged. For example, TVs used to be bulky boxes, with a small, low res, black and white screen. These days they are flat and high res with a large colour screen. They’re better TVs. So part of the price difference between TVs now and TVs in the 1950s is that money is worth less, but some of it is that TVs are better. If you’re interested in tracking how much your currency is worth less these days, you need to compensate for this. On the other hand, if you want to buy a bottom of the range TV… you can’t buy a small bulky black and white TV these days. You’re going to buy a more expensive colour flat screen, and ok it’s better, but it’s also costing you more. (This also applies to fridges, freezers, washing machines etc.) Tldr RPI/CPI track changes in the value of money, and understate changes in the cost of living due to quality improvements in the goods people buy.
  - jjgreen 4y ago
    RPI is the arithmetic mean, CPI the geometric mean (and some other smaller differences); the arithmetic-geometric mean inequality indicates the motivation for the switchover. https://en.wikipedia.org/wiki/Inequality_of_arithmetic_and_geometric_means https://en.wikipedia.org/wiki/Inequality_of_arithmetic_and_g...
    - _benedict 4y ago
      RPI also includes some housing costs that are left out of CPI.
      - jjgreen 4y ago
        Indeed, the relative importance of that and the AM/GM change ("formula effects") can be seen in this document from the UK Office of National Statistics https://web.archive.org/web/20101214034940/http://www.statistics.gov.uk/downloads/theme_economy/cpi-rpi-information-note.pdf https://web.archive.org/web/20101214034940/http://www.statis...
  - tyho 4y ago
    It's good to track different rates as you can then choose the index that suits you best. For example, RPI is typically higher than CPI, so naturally my student loan interest is a function of RPI, whereas tax thresholds are indexed to CPI. This works well in ensuring the government can achieve its primary aim which is to transfer all surplus worker productivity to wealthy pensioners.
    - iso1631 4y ago
      To be fair I'm not sure if that's the primary aim or just a side effect
      - jjgreen 4y ago
        Dr. Pangloss I presume?
    - II2II 4y ago
      Different country, but I've noticed that social assistance are linked to the CPI yet the CPI is linked to items that those who receive social assistance cannot afford and which are less impacted by inflation (at least under normal circumstances, I'm not sure about the current situation). I'm not sure about the intent though. When the government first announced COVID benefits it was quickly revealed that they had no understanding what most vulnerable members of society were facing. It took several rounds of announcements until everyone was satisfied. Likewise, the article's comment about pay increases for public sector employees made me cringe. At least on this side of the pond, the public sector has been hit hard and is in chaos since pay is based upon union contracts that were pre-pandemic. In some cases, union contracts expired early in the pandemic but where negotiations were stalled until recently due to the pandemic.
- ArchitectAnon 4y ago
  Construction materials is something like 30%
roenxi 4y ago
It will take a while to get a full picture of what is going on but the trends I've been watching: - The UK has been sliding into political irrelevance for decades. - Since around the mid-late 2000s, big chunks of Europe (like the UK) seem to have been sliding towards having much less available energy to fund their lifestyles. - They shot their own economy during COVID, as many nations did. They're doing pretty well to hold together as a political unit. I was worried it would be worse and I'm glad to be wrong so far.
- jeromegv 4y ago
  UK is one of the western country that did the least to shut down their economy and lifted all restrictions up very very quickly. That doesn’t seem to be as relevant to let’s say something else having a very long term impact called… Brexit.
  - alibarber 4y ago
    As a British Citizen who lived in Finland throughout the pandemic, the UK's restrictions and shutdowns were several orders of magnitude higher, and longer lasting, than what I experienced there.
    - throwaway5371 4y ago
      the netherlands were in lockdown until this february, by then most people in uk were not even taking about covid
- pjc50 4y ago
  > They're doing pretty well to hold together as a political unit. I was worried it would be worse and I'm glad to be wrong so far. Most western countries have got very good at internal security since the War On Terror, and anyone trying to do direct action or work outside the political system tends to get squashed very quickly. (Obvious exceptions: France, which has much more of a riot tradition, and the Jan 6 events, which had insider assistance of some unclear sort) Surprisingly, I don't think COVID has caused too much lasting damage due to being offset by the economic stimulus, although the number of dead or sick workers is probably enough to be significant. It does seem to have been Brexit: https://www.newstatesman.com/chart-of-the-day/2022/06/uk-economy-fallen-behind-eu-since-brexit https://www.newstatesman.com/chart-of-the-day/2022/06/uk-eco...
willcipriano 4y ago
My wife is a UK citizen and we have considered moving there, but even when I was a lowly two years of experience sysadmin they couldn't put up a salary that made sense (and yes that factors healthcare into account). You'd think they are at a wage floor already but it seems that it can go lower.
- djohnston 4y ago
  I took a big paycut to move out here. It has tradeoffs and I'm relatively young without family, but yeah it is a little annoying seeing intra-company peers making 30% more to do the same thing. My bet is that an island is easier to defend from mass migration once the water wars kick off in a few decades - and it's pretty fun to travel about Europe in the meantime.
  - kmlx 4y ago
    > once the water wars kick off in a few decades ?? could you provide some details about this? i thought water is a non issue because we have incredible amounts of it that just needs energy to desalinate, energy which will come very cheap in a couple of decades.
    - _dain_ 4y ago
      > just needs energy to desalinate That's a very load-bearing "just". Germany is busy shooting itself in the head by turning off their nuclear reactors.
    - n4r9 4y ago
      I wondered whether they were referring to rising sea levels, but then it would make a lot more sense to go to Norway.
    - djohnston 4y ago
      I think modernised nations will be able to produce that sort of massive energy, and are also less likely to be impacted by climate change related droughts/famines in the first place. Unfortunately and unjustly it's the poor countries along the equator that are f*cked, and unless some crazy political restructuring happens these countries don't have a shot of updating their economies fast enough to desalinate their way out of oblivion.
pjc50 4y ago
It's bizarre that this can happen at the same time as widespread staff shortages are being reported in some sectors, but there we are. https://www.theweek.co.uk/business/economy/956951/labour-shortages-urgent-problem-economy https://www.theweek.co.uk/business/economy/956951/labour-sho... It seems to me that decades of industrial policy have been aimed at clamping down any means to demand nominal wage increases, especially through industrial action, so we are now stuck in a low-wage staff shortage situation; this would be a great time to invest capital in productivity increases, especially while interest rates are below inflation, but British management culture is too dysfunctional for even that. And the government are not going to do anything useful because they're busy competing for the top job, egged on by a press who don't care about industrial policy or wages.
- dazc 4y ago
  I remember looking for casual work ten years ago and a lot of jobs had hours arranged to specifically attract people who were happy to have their income subsidised by benefits. Since there were plenty of available workers it was a good game they were playing. Now the same employers are complaining they can't attract people to apply for the same shitty deal as if they are entitled to have a surplus of people to pick from. The problem is now that the cost of housing has more than doubled over the past ten years and now we have an inflation problem too. They can't double the pay and, even if they could, this would just be adding fuel to the fire. How this will play out, I don't know, but maybe we don't need multiple versions of the same kind of business and only those who can get the staff will survive and prosper?
  - _dain_ 4y ago
    >hours arranged to specifically attract people who were happy to have their income subsidised by benefits. You don't know the half of it. I got stuck in this trap when I was a teenager: https://www.theguardian.com/business/2017/aug/30/poundland-work-free-government-scheme-dwp https://www.theguardian.com/business/2017/aug/30/poundland-w... It was outrageous.
    - pjc50 4y ago
gorgoiler 4y ago
Does inflation include rent? If inflation goes up then my landlord will have to pay more for his potatoes. My landlord’s sole source of income is the rent I pay him. Does that mean I have to pay more rent, so he can afford his potatoes? The cost of potatoes goes up for me as well. So am I being hit twice by the potato price hike — once for me and then again for my landlord? In a fair world, renting a property is paying for the right to live somewhere and nothing more, but I feel like in the unfair world landlords feel entitled to rent as an income stream and as such when the potato price goes up they will ask for a “pay raise” (rent rise) to cover it.
- DoktorDelta 4y ago
  Turns out, our landlords are also living paycheck-to-paycheck, just not their paycheck
  - adolph 4y ago
    Are we all not the paycheck of others and they our own paycheck?
- maest 4y ago
  By that logic, when you pay for potato, you also pay for the gas used to transport the potatos. But you already pay for gas when you drive around, so you're getting hit by inflation twice.
- redorb 4y ago
  Your paying for the right to live there. What the money you pay is used for is none of your business. I find it a lot healthier to not worry about the money after I spend it, it's no longer mine for I have agreed to trade it away.
  - throwaway0a5e 4y ago
    It's not worth worrying about but it's worth caring about IMO. Buying a sandwich from a sandwich shop who's landlord will likely donate to politicians that want to make your life suck is the smaller stakes but closer to home version of nations buying oil that funds people who hate them.
spywaregorilla 4y ago
Headline implies falling wages and rising inflation. It's really rising wages but faster rising inflation. So to be clear, it's just real wages falling. I'm amused there's no mention of brexit. I feel that's left the public conscious already even though the economic effects will ripple across the country for decades.
- dazc 4y ago
  > I'm amused there's no mention of brexit. I feel that's left the public conscious already... Don't worry, there are people who will bring it up over and over again. Unless inflation, low pay, expensive housing, the energy crisis, etc are all uniquely a British problem I fear that Brexit may not be a factor in this at all?
  - spywaregorilla 4y ago
    > Unless inflation, low pay, expensive housing, the energy crisis, etc are all uniquely a British problem I fear that Brexit may not be a factor in this at all? That's nonsense reasoning. Brexit is not the proximate cause of all problems but its a long term driver of economic decline.
  - sofixa 4y ago
    > Unless inflation, low pay, expensive housing, the energy crisis, etc are all uniquely a British problem I fear that Brexit may not be a factor in this at all? Or it's simply one factor among others. Closing your eyes and pretending it had no impact whatsoever won't make it go away.
yrgulation 4y ago
Meaning people will have a lower budget allocated for a mortgage, meaning real estate prices should drop. The rise in building material costs should in theory push prices up, but if there's no one to buy then there's not much room for increasing prices.
- substation13 4y ago
  UK government will not let this happen. Whatever lever they can pull will be pulled to maintain UK house prices.
  - 5350-uiop-1130 4y ago
    yeah the tories had 20 years to fix things but yet things got worse. hmm, wonder why that is now....
- 5350-uiop-1130 4y ago
  this inflation, low wages, is more about the massive wealth inequality gap you can either afford to buy a flat for a half million or you're living hand to mouth
- pjc50 4y ago
  Interest rate rises themselves should do that, but there's no sign of this happening yet. https://news.sky.com/story/uk-house-prices-rise-to-sixth-consecutive-record-but-there-are-signs-of-a-slowdown-12654244 https://news.sky.com/story/uk-house-prices-rise-to-sixth-con... Don't forget the buying power of overseas money.
CommanderData 4y ago
The United Kingdom like others are in a race to the bottom in terms of wages. Contractor and Perm salaries in the tech sector to me are a good representative of the situation overall. Wages in these areas have stayed roughly the same because there's an illusion that they are already paid too much (5-10%+ over 3 years). Inflation + the race down make the UK job hunt seem less and less appealing to the extent I know a few people who've packed up and gone across the pond to Europe. The skills shortage is only going to get worse with an already stretched and dwindling pool of people and there is no sign of let off to undermine wages yet, and this is just in London. The situation of pay falling despite a shortage of workers is bizarre but we can't forget the efforts to undermine and keep wages low.
- 0xy 4y ago
  I was under the impression that tech contracting work was effectively neutered by the government with legislation that made it nearly impossible to do. Back in the good days you could earn 800 pounds day rates, which is a very good salary by UK standards. Then the parasitic HMRC decided it wanted a much larger slice of that pie.
  - deleted 4y ago
    [deleted]
  - cutthegrass2 4y ago
    Sadly, all flavours of UK government have had their grubby mitts on IR35 and failed to do anything meaningful with it. Labour introduced the idea (thanks Gordon Brown), the Lib/Con coalition did a "review" of it and then the latest Conservative govt got it over the line. HMRC are just responsible for collecting the taxes, not making the laws. Infosys has been doing rather well since the legislation hit the private sector though.
    - mmarq 4y ago
      It was shameful that IT contractors making 800£ per pay paid less taxes than a waiter making 200£ per week. IR35 is probably the only reasonable thing the conservative governments from Cameron onwards have done
TedShiller 4y ago
“Transitory”

94 points by saos 4y ago

jjgreen 4y ago

... and the real rate of inflation, RPI, is at 11.7%

dave4420 4y ago
Meh. There’s no single real rate of inflation. Different methods of measuring inflation have their pros and cons. Meanwhile, neither RPI or CPI try to track increases in the cost of living.
- gruez 4y ago
  >Meanwhile, neither RPI or CPI try to track increases in the cost of living They don't? What are they tracking then?
  - iso1631 4y ago
    They are tracking the price of an arbitrary basket of goods which is going to be different to your personal basket, as is required. The increase in the cost of living for someone who drives 20,000 miles a year will be different to that of someone who gets a train to work to that of someone who works from home to that of a pensioner with a small amount of money to a pensioner with a large amount of money
    - swores 4y ago
      You're describing the method they used to try to (roughly) "track the cost of living". You can argue that it is or isn't doing a good enough job in terms of the choices made but that's specifically what it's doing (and while it may not be doing it well enough, it obviously does need to be done based on sampling not based on producing an exact % for each individual that the things they bought over the past year have increased). (You're not the person who wrote "neither RPI or CPI try to track increases in the cost of living", but that's the context of this comment chain.)
  - dave4420 4y ago
    They’re tracking the value of money. RPI/CPI aren’t only tracking the prices paid, but also the quality of goods exchanged. For example, TVs used to be bulky boxes, with a small, low res, black and white screen. These days they are flat and high res with a large colour screen. They’re better TVs. So part of the price difference between TVs now and TVs in the 1950s is that money is worth less, but some of it is that TVs are better. If you’re interested in tracking how much your currency is worth less these days, you need to compensate for this. On the other hand, if you want to buy a bottom of the range TV… you can’t buy a small bulky black and white TV these days. You’re going to buy a more expensive colour flat screen, and ok it’s better, but it’s also costing you more. (This also applies to fridges, freezers, washing machines etc.) Tldr RPI/CPI track changes in the value of money, and understate changes in the cost of living due to quality improvements in the goods people buy.
- jjgreen 4y ago
  RPI is the arithmetic mean, CPI the geometric mean (and some other smaller differences); the arithmetic-geometric mean inequality indicates the motivation for the switchover. https://en.wikipedia.org/wiki/Inequality_of_arithmetic_and_geometric_means https://en.wikipedia.org/wiki/Inequality_of_arithmetic_and_g...
  - _benedict 4y ago
    RPI also includes some housing costs that are left out of CPI.
    - jjgreen 4y ago
      Indeed, the relative importance of that and the AM/GM change ("formula effects") can be seen in this document from the UK Office of National Statistics https://web.archive.org/web/20101214034940/http://www.statistics.gov.uk/downloads/theme_economy/cpi-rpi-information-note.pdf https://web.archive.org/web/20101214034940/http://www.statis...
- tyho 4y ago
  It's good to track different rates as you can then choose the index that suits you best. For example, RPI is typically higher than CPI, so naturally my student loan interest is a function of RPI, whereas tax thresholds are indexed to CPI. This works well in ensuring the government can achieve its primary aim which is to transfer all surplus worker productivity to wealthy pensioners.
  - iso1631 4y ago
    To be fair I'm not sure if that's the primary aim or just a side effect
    - jjgreen 4y ago
      Dr. Pangloss I presume?
  - II2II 4y ago
    Different country, but I've noticed that social assistance are linked to the CPI yet the CPI is linked to items that those who receive social assistance cannot afford and which are less impacted by inflation (at least under normal circumstances, I'm not sure about the current situation). I'm not sure about the intent though. When the government first announced COVID benefits it was quickly revealed that they had no understanding what most vulnerable members of society were facing. It took several rounds of announcements until everyone was satisfied. Likewise, the article's comment about pay increases for public sector employees made me cringe. At least on this side of the pond, the public sector has been hit hard and is in chaos since pay is based upon union contracts that were pre-pandemic. In some cases, union contracts expired early in the pandemic but where negotiations were stalled until recently due to the pandemic.
ArchitectAnon 4y ago
Construction materials is something like 30%

roenxi 4y ago

It will take a while to get a full picture of what is going on but the trends I've been watching: - The UK has been sliding into political irrelevance for decades. - Since around the mid-late 2000s, big chunks of Europe (like the UK) seem to have been sliding towards having much less available energy to fund their lifestyles. - They shot their own economy during COVID, as many nations did. They're doing pretty well to hold together as a political unit. I was worried it would be worse and I'm glad to be wrong so far.

jeromegv 4y ago
UK is one of the western country that did the least to shut down their economy and lifted all restrictions up very very quickly. That doesn’t seem to be as relevant to let’s say something else having a very long term impact called… Brexit.
- alibarber 4y ago
  As a British Citizen who lived in Finland throughout the pandemic, the UK's restrictions and shutdowns were several orders of magnitude higher, and longer lasting, than what I experienced there.
  - throwaway5371 4y ago
    the netherlands were in lockdown until this february, by then most people in uk were not even taking about covid
pjc50 4y ago
> They're doing pretty well to hold together as a political unit. I was worried it would be worse and I'm glad to be wrong so far. Most western countries have got very good at internal security since the War On Terror, and anyone trying to do direct action or work outside the political system tends to get squashed very quickly. (Obvious exceptions: France, which has much more of a riot tradition, and the Jan 6 events, which had insider assistance of some unclear sort) Surprisingly, I don't think COVID has caused too much lasting damage due to being offset by the economic stimulus, although the number of dead or sick workers is probably enough to be significant. It does seem to have been Brexit: https://www.newstatesman.com/chart-of-the-day/2022/06/uk-economy-fallen-behind-eu-since-brexit https://www.newstatesman.com/chart-of-the-day/2022/06/uk-eco...

willcipriano 4y ago

My wife is a UK citizen and we have considered moving there, but even when I was a lowly two years of experience sysadmin they couldn't put up a salary that made sense (and yes that factors healthcare into account). You'd think they are at a wage floor already but it seems that it can go lower.

djohnston 4y ago
I took a big paycut to move out here. It has tradeoffs and I'm relatively young without family, but yeah it is a little annoying seeing intra-company peers making 30% more to do the same thing. My bet is that an island is easier to defend from mass migration once the water wars kick off in a few decades - and it's pretty fun to travel about Europe in the meantime.
- kmlx 4y ago
  > once the water wars kick off in a few decades ?? could you provide some details about this? i thought water is a non issue because we have incredible amounts of it that just needs energy to desalinate, energy which will come very cheap in a couple of decades.
  - _dain_ 4y ago
    > just needs energy to desalinate That's a very load-bearing "just". Germany is busy shooting itself in the head by turning off their nuclear reactors.
  - n4r9 4y ago
    I wondered whether they were referring to rising sea levels, but then it would make a lot more sense to go to Norway.
  - djohnston 4y ago
    I think modernised nations will be able to produce that sort of massive energy, and are also less likely to be impacted by climate change related droughts/famines in the first place. Unfortunately and unjustly it's the poor countries along the equator that are f*cked, and unless some crazy political restructuring happens these countries don't have a shot of updating their economies fast enough to desalinate their way out of oblivion.

pjc50 4y ago

It's bizarre that this can happen at the same time as widespread staff shortages are being reported in some sectors, but there we are. https://www.theweek.co.uk/business/economy/956951/labour-shortages-urgent-problem-economy https://www.theweek.co.uk/business/economy/956951/labour-sho... It seems to me that decades of industrial policy have been aimed at clamping down any means to demand nominal wage increases, especially through industrial action, so we are now stuck in a low-wage staff shortage situation; this would be a great time to invest capital in productivity increases, especially while interest rates are below inflation, but British management culture is too dysfunctional for even that. And the government are not going to do anything useful because they're busy competing for the top job, egged on by a press who don't care about industrial policy or wages.

dazc 4y ago
I remember looking for casual work ten years ago and a lot of jobs had hours arranged to specifically attract people who were happy to have their income subsidised by benefits. Since there were plenty of available workers it was a good game they were playing. Now the same employers are complaining they can't attract people to apply for the same shitty deal as if they are entitled to have a surplus of people to pick from. The problem is now that the cost of housing has more than doubled over the past ten years and now we have an inflation problem too. They can't double the pay and, even if they could, this would just be adding fuel to the fire. How this will play out, I don't know, but maybe we don't need multiple versions of the same kind of business and only those who can get the staff will survive and prosper?
- _dain_ 4y ago
  >hours arranged to specifically attract people who were happy to have their income subsidised by benefits. You don't know the half of it. I got stuck in this trap when I was a teenager: https://www.theguardian.com/business/2017/aug/30/poundland-work-free-government-scheme-dwp https://www.theguardian.com/business/2017/aug/30/poundland-w... It was outrageous.
  - pjc50 4y ago

gorgoiler 4y ago

Does inflation include rent? If inflation goes up then my landlord will have to pay more for his potatoes. My landlord’s sole source of income is the rent I pay him. Does that mean I have to pay more rent, so he can afford his potatoes? The cost of potatoes goes up for me as well. So am I being hit twice by the potato price hike — once for me and then again for my landlord? In a fair world, renting a property is paying for the right to live somewhere and nothing more, but I feel like in the unfair world landlords feel entitled to rent as an income stream and as such when the potato price goes up they will ask for a “pay raise” (rent rise) to cover it.

DoktorDelta 4y ago
Turns out, our landlords are also living paycheck-to-paycheck, just not their paycheck
- adolph 4y ago
  Are we all not the paycheck of others and they our own paycheck?
maest 4y ago
By that logic, when you pay for potato, you also pay for the gas used to transport the potatos. But you already pay for gas when you drive around, so you're getting hit by inflation twice.
redorb 4y ago
Your paying for the right to live there. What the money you pay is used for is none of your business. I find it a lot healthier to not worry about the money after I spend it, it's no longer mine for I have agreed to trade it away.
- throwaway0a5e 4y ago
  It's not worth worrying about but it's worth caring about IMO. Buying a sandwich from a sandwich shop who's landlord will likely donate to politicians that want to make your life suck is the smaller stakes but closer to home version of nations buying oil that funds people who hate them.

spywaregorilla 4y ago

Headline implies falling wages and rising inflation. It's really rising wages but faster rising inflation. So to be clear, it's just real wages falling. I'm amused there's no mention of brexit. I feel that's left the public conscious already even though the economic effects will ripple across the country for decades.

dazc 4y ago
> I'm amused there's no mention of brexit. I feel that's left the public conscious already... Don't worry, there are people who will bring it up over and over again. Unless inflation, low pay, expensive housing, the energy crisis, etc are all uniquely a British problem I fear that Brexit may not be a factor in this at all?
- spywaregorilla 4y ago
  > Unless inflation, low pay, expensive housing, the energy crisis, etc are all uniquely a British problem I fear that Brexit may not be a factor in this at all? That's nonsense reasoning. Brexit is not the proximate cause of all problems but its a long term driver of economic decline.
- sofixa 4y ago
  > Unless inflation, low pay, expensive housing, the energy crisis, etc are all uniquely a British problem I fear that Brexit may not be a factor in this at all? Or it's simply one factor among others. Closing your eyes and pretending it had no impact whatsoever won't make it go away.

yrgulation 4y ago

Meaning people will have a lower budget allocated for a mortgage, meaning real estate prices should drop. The rise in building material costs should in theory push prices up, but if there's no one to buy then there's not much room for increasing prices.

substation13 4y ago
UK government will not let this happen. Whatever lever they can pull will be pulled to maintain UK house prices.
- 5350-uiop-1130 4y ago
  yeah the tories had 20 years to fix things but yet things got worse. hmm, wonder why that is now....
5350-uiop-1130 4y ago
this inflation, low wages, is more about the massive wealth inequality gap you can either afford to buy a flat for a half million or you're living hand to mouth
pjc50 4y ago
Interest rate rises themselves should do that, but there's no sign of this happening yet. https://news.sky.com/story/uk-house-prices-rise-to-sixth-consecutive-record-but-there-are-signs-of-a-slowdown-12654244 https://news.sky.com/story/uk-house-prices-rise-to-sixth-con... Don't forget the buying power of overseas money.

CommanderData 4y ago

The United Kingdom like others are in a race to the bottom in terms of wages. Contractor and Perm salaries in the tech sector to me are a good representative of the situation overall. Wages in these areas have stayed roughly the same because there's an illusion that they are already paid too much (5-10%+ over 3 years). Inflation + the race down make the UK job hunt seem less and less appealing to the extent I know a few people who've packed up and gone across the pond to Europe. The skills shortage is only going to get worse with an already stretched and dwindling pool of people and there is no sign of let off to undermine wages yet, and this is just in London. The situation of pay falling despite a shortage of workers is bizarre but we can't forget the efforts to undermine and keep wages low.

0xy 4y ago
I was under the impression that tech contracting work was effectively neutered by the government with legislation that made it nearly impossible to do. Back in the good days you could earn 800 pounds day rates, which is a very good salary by UK standards. Then the parasitic HMRC decided it wanted a much larger slice of that pie.
- deleted 4y ago
  [deleted]
- cutthegrass2 4y ago
  Sadly, all flavours of UK government have had their grubby mitts on IR35 and failed to do anything meaningful with it. Labour introduced the idea (thanks Gordon Brown), the Lib/Con coalition did a "review" of it and then the latest Conservative govt got it over the line. HMRC are just responsible for collecting the taxes, not making the laws. Infosys has been doing rather well since the legislation hit the private sector though.
  - mmarq 4y ago
    It was shameful that IT contractors making 800£ per pay paid less taxes than a waiter making 200£ per week. IR35 is probably the only reasonable thing the conservative governments from Cameron onwards have done

TedShiller 4y ago

“Transitory”