The Government’s pledge to raise living standards across the UK faces a substantial challenge as many workers continue to feel financially insecure, the Work Foundation at Lancaster University warns.
New analysis of a representative survey of 3,796 UK workers finds that one in six (17%) report they struggle to pay their bills each month, and four in ten workers (43%) say they have little income left for savings or holidays.
The UK workforce is currently experiencing the strongest period of sustained wage growth for over 20 years while average nominal wages have increased by more than 5% for 34 consecutive months since July 2022. However, researchers say that workers are still struggling to make ends meet, as years of wage stagnation and the cost of living crisis mean that for many, wages still do not cover basic living costs.
Only half of workers (48%) surveyed believe wage increases are keeping up with the cost of living and just 43% expect an above inflation pay rise in the next 12 months (26% did not expect an above inflation pay rise and 30% neither agreed/disagreed or were N/A). Low paid workers are feeling the brunt of financial pressures, with only 42% of those earning less than £25,000 stating their pay is keeping up with the cost of living, compared to 73% of higher paid workers (earning £60,000 or more).
The survey results come as recent ONS figures indicate that 1.35 million UK people have second jobs – an increase of 121,000 (10%) on the year and the highest level since records began in 1992. Analysis shows this has been primarily driven by male workers (18.6% on the year vs 3.4% for female) but female workers are still more likely to have second jobs overall (54.5% vs 45.5%).
Ben Harrison, Director of the Work Foundation at Lancaster University said, “Raising living standards is not just about figures on a spreadsheet, it’s about workers feeling more financially secure. Four years on from the start of the worst cost of living crisis in a generation, our analysis shows workers continue to feel the impact of nearly 20 years of stagnating pay packets.
“Second jobs are sometimes glamorised as ‘side hustles’ or optional extras but economic necessity is often a key motivation. Despite a period of sustained pay increases, the growth in second jobs points to continued cost of living pressures that mean some workers are struggling to make enough money in their main roles and are taking on additional jobs to make ends meet.”
