Pay cut for millions as real wages drop by 2.9% – what it means for your money


MILLIONS of workers are facing a cut to pay as runaway inflation eats into household earnings.

New figures released today by the Office for National Statistics (ONS) show that regular pay in real terms fell by 2.9% over the year.

Regular pay has dropped as workers face a drop in income

This is one of the largest falls seen since records began in 2001.

Runaway inflation is overtaking pay packet hikes, which means people are facing a drop in income in real terms.

Inflation dropped slightly to 9.9% in August from 10.1%, but it is still close to a 40-year high.

A real terms pay cut means even if wages are going up, they don’t match the rate of inflation – which means people are effectively worse off.

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