Britain’s unemployment rate is at a record low at 5.1% but wage growth is pretty diabolical.
In other words, a lot more people across Britain are in jobs but they aren’t earning great amounts.
In fact, according to the Office for National Statistics’ latest data, wage growth slowed in the three months to February. Wages grew 1.8%, down from 2.1% in January, and far lower than the 2.3% growth expected by economists.
This is a huge problem because Britain’s cost of living is high and if your salary is not keeping up with rises, you have very little left once you pay off rent, groceries, utility bills and transportation fees.
And this chart from Glassdoor’s report entitled “Which Countries in Europe Offer The Best Standard of Living?,” shows just how bad Britons have it when it comes to pay:
Glassdoor took a look at some of the major countries in Europe and looked how wages compared to the cost of living — Purchasing Power Parity (PPP).
“Comparing nominal wages across countries only tells part of the story. It does not take into account what those incomes can actually buy. One way economists address this issue is to adjust income data from different countries to produce Purchasing Power Parity (PPP) figures,” said Glassdoor in the report.
“These adjustments [on a PPP basis] take into account differences in relative prices within countries, so as to estimate how much money would be needed to buy the equivalent goods and services in each. The adjusted figures are typically expressed relative to the United States, which is taken as the benchmark.
“Because the cost of locally-sold goods and services tend to be lower in lower-income countries, PPP-adjusted figures tend to narrow somewhat the differences in wages across countries on a PPP basis: wages on a PPP basis in the highest paying country are on average around double those in the lowest.”
Basically, that little blue triangle shows what Britons used to earn on a PPP basis before the credit crisis and the green bar shows what people in the UK are earning now.
While everywhere else in the chart show that average pay is either at the same level or surpassing that of over eight years ago, only Greece — which is having severe economic turmoil — is struggling to pay its citizens a wage that was comparable to 2007.
Here is the cost of living chart:
Glassdoor didn’t give a breakdown of each country’s average wage on on a “PPP” basis but it said that the highest salaries were around €40,500 in Switzerland and Ireland, while the lowest were at €20,000 in Estonia, Portugal, and Greece.
So if wages are not high enough to allow you to afford to live, you have to take on more debt to help you get by.
This story was originally published by Glassdoor.