Inflation falls to below the latest rate of wage increases
However, of course, while these wage rises were below the rate of inflation, that still left people worse off in real terms.
But today we have turned an important corner: new figures show that inflation has dropped to 6.8% which is below the latest average annual figure for wage increases.
Price rises for different goods and services have been running at different rates, and the average income rise figures hides considerable variation from one group of workers to another, so this does not mean everyone is better off.
We urgently need to boost productivity so that the economy can afford to pay people more while completing the task of halving inflation this year and ultimately getting it down to 2%. But at least we can say that the economy is beginning to move in the right direction.
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