Young families were particularly hard hit by an “abrupt” slowdown in living standards in the year before the general election, a think tank says.The Resolution Foundation found that average income growth halved to 0.7% during that period compared with the previous year.Those aged 25-34 were worst hit, it said, with their average incomes no higher than they were in 2002-03.Pensioner incomes grew by 30% over that 15-year period, the think tank said.The foundation, which analyses living standards, said young families were the only group whose incomes have failed to return to pre-financial crisis levels.’Bleak economic backdrop'”The typical 25 to 34-year-old appears no better off today than in 2002-03,” the report said.”In comparison, typical incomes for all other age groups are now above, or very near, their pre-recession peaks.”The fall in average income growth followed a “mini-boom” between 2013 and 2015, the foundation said, when living standards improved.Are pensioners better off than workers?
Pensions, parents and children: Am I better off?
Families in rented accommodation have experienced little or no income growth, while home-owners had a 1.7% growth, the report found.The think tank’s senior economic analyst, Adam Corlett, said: “For millions of young and lower-income families the slowdown over the last year has come off the back of a tough decade for living standards, providing a bleak economic backdrop to the shock election result.”Over the last 15 years and four prime ministers, Britain has failed to deliver decent living standards growth for young families and those on low incomes.”Rising housing costs have added further financial pressures.”Over the year, incomes among low to middle-income families grew by 0.4%, compared with 1% for those in the top half of the income distribution.Two out of five of this group said they were not able to save £10 per month, while 42% cannot afford a holiday at least one week per year.”Despite the welcome political focus on such ‘just managing families’, we estimate that income growth for this group in 2016-17, ahead of the election, was lower than for higher income groups,” the report said.The top 1% of households had a “rapid recovery” in incomes, the report said, and now have an 8.7% share of the nation’s income.The think tank said the fortunes of the top 1% had been the driving force of rising inequality since the mid-1990s.Inequality among the remaining 99% of the population fell over the same period.
Source: BBC News