Wages could rise this month in real terms for the first time in six years

Wages could rise faster than inflation for the first time in six years, according to EY, meaning a real-term rise for workers.

Inflation is forecast at an average 1.6% for 2014, but wages could rise by 1.7%, meaning wage increases will be higher than increases in the cost of living for the first time in six years.

The report said: “We expect wage growth to overtake CPI inflation as early as April.”

Peter Spencer, the EY ITEM Club’s chief economic advisor said: “Until now the recovery has been financed by a fall in the amount households save, but it appears to be moving to a firmer footing.”

“The consumer upturn will be given a boost from real wages and rising employment, while investment is finally kicking in.”

NOW READ:

Average London property to cost £700,000 by 2020

Social Bookmarks