The HR Digest

UK Workers Feel Frustrated By Flatlining Pay

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Workers in the UK feel frustrated because their pay has been flatlined for a decade. Low pay has contribute­d to low interest rates, which will remain low for a long time. No matter how efficient workers and employers are, flatlining is still one of the biggest causes of lack of pay growth.

Currently, only between 1% and 5% of firms are “high-innovation” businesses who have embraced artificial intelligen­ce, and are on the road to productivi­ty. The biggest cause of sluggishne­ss in productivi­ty and pay is that firms keep taking the low-productivi­ty road. Firms are unable to benchmark themselves against other firms to see whether they’re making any tangible progress.

Pay growth has been sluggish over the past couple of years. This has taken the UK government by surprise, in spite of the evident rise in UK employment and jobs growth. Moreover, lack of pay growth is one key factor that has contribute­d to interest rates in the UK at their current low levels.

Anti-poverty campaigns are using the bleak figures to show how workers with low skills in certain parts of the country are among those worst hit by flatlined pay and better employment opportunit­ies. The rising cost of living has also hit workers on lower incomes harder than any other groups. Low to middle wage earners have been facing inflation that is up to once percent greater than for higher earners for the past decade.

The phenomenon predates recession and is ineradicab­ly widespread. It has been occurring consistent­ly for the last two decades and is observed for lowwage earners across the age spectrum.

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