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[Economics] UK faces biggest fall in living standards on record

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The UK faces its biggest drop in living standards on record as the surging cost of living eats into people's wages.

The government's forecaster said that household incomes - once rising prices were taken into account - would dive by 7% in the next few years.

It also expects the number of people who are unemployed to rise by more than 500,000.

It came as the chancellor said the UK was already in recession and set to shrink further next year.

But Jeremy Hunt said his Autumn Statement - which unveiled £55bn of tax rises and spending cuts - would lead to a "shallower downturn" with fewer jobs lost.

Paul Johnson, director of the Institute for Fiscal Studies think tank, said: "Surging global energy prices have made the UK a poorer country. The result is an OBR (Office for Budget Responsibility) forecast that the next two years will see the biggest fall in household incomes in generations."

Energy and food bills have shot up due to the war in Ukraine and pandemic, and are squeezing household budgets.

Link: https://www.bbc.com/news/business-63659936

Edited by [Depo]


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