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gruffydd

No Wage Growth In Uk And Usa - Financialization Destroys Incomes

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Who will page for rising rents/rising house prices? I wouldn't be surprised to see real wages falling before long...

UK: http://www.theguardian.com/business/2015/dec/30/stalling-uk-wage-growth-set-to-revive-debate-over-migrant-workers

USA http://www.theguardian.com/business/economics-blog/2016/jan/08/us-employment-up-wages-static

"Average pay growth for Britain’s workers is likely to stall at about 2% in 2016"

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Who needs wage growth when you can borrow money???

This was the core financial innovation of the past 20 years- replace demand via wages with demand via credit- what could possibly go wrong? :lol:

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This was the core financial innovation of the past 20 years- replace demand via wages with demand via credit- what could possibly go wrong? :lol:

This was the plan as outlined via the right wing think tanks circa 1950's to the 70's when it was determined that labour was getting too much of their efforts returned to them in the way of wages wheras all wealth should belong to the owners of capital. The manifesto was roughly this:

Delete unions

Globalisation of jobs (however was not defined as such at the time but was based on cheap labour of any sort)

Delete borders for capital (create more disruption in 3rd world countries)

Cut wages by any means possible, eg via deleted unions and globalisation

Workers who needed more money for what ever reason to borrow more easily which was to make them more beholden to the system.

Give the bankers all the freedom they needed.

etc etc

Which has already played out to perfection, however what they did not do was allow for flaws in the case on account of it was to be the perfect world where the rich were rich and the workers obedient and they had no ongoing plan for what to do once they had achieved this, nor did they expect that the bankers freedom would lead to where we are today, that is, they let greed at the top run rampant.

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Financialization AND globalization AND to a lesser extent, inefficiency and size of in the public sector.

Updated for the UK.

You have an economy where are large part - tax credits - just sit sucking money in for nothing. Then you have a large, bloated, self serviing public sector.

Then you have stuff like 35 year mortgages that have just sucked all the money out of the economy.

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All this "no wage growth" myth gets right on my wick!

I realize some people won't get any pay rises but others do

I've had an average of 5.9% wage growth every year over the last 8 years

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All this "no wage growth" myth gets right on my wick!

I realize some people won't get any pay rises but others do

I've had an average of 5.9% wage growth every year over the last 8 years

Have you ever heard the phrase, "I'm alright Jack"?

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All this "no wage growth" myth gets right on my wick!

I realize some people won't get any pay rises but others do

I've had an average of 5.9% wage growth every year over the last 8 years

For doing *exactly* the same job? No job switches or promotions in the mix?

Perhaps more pertinently, would a new starter today be on near double what a new starter 8 years ago was on too?

If so, where can we apply please?

Edited by Frugal Git

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Frugal, there have been promotions but promotions aside, I got 5% last June with no promotion and before that 6% year before with no promotion.

My payrises for promotion have not been greatly different to usual pay rises.

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All this "no wage growth" myth gets right on my wick!

I realize some people won't get any pay rises but others do

I've had an average of 5.9% wage growth every year over the last 8 years

Everything depends on what proportions of the population are in the "some" and "other" groups. Also, what percentage pay rises the "others" are getting.

The latest figures I can find on the ONS website for rise in earnings are from March 2014. For earnings without bonuses the annual growth was 1.6% in the private sector and 1.1% in the public sector. Alright, some people, including you, are getting 5.9% wage growth a year, when the average is less than 2%. What does that say about the wage growth other people are seeing?

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Which makes the headline "No Wage Growth In UK" sensationalism

Everything depends on what proportions of the population are in the "some" and "other" groups. Also, what percentage pay rises the "others" are getting.

The latest figures I can find on the ONS website for rise in earnings are from March 2014. For earnings without bonuses the annual growth was 1.6% in the private sector and 1.1% in the public sector. Alright, some people, including you, are getting 5.9% wage growth a year, when the average is less than 2%. What does that say about the wage growth other people are seeing?

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This was the plan as outlined via the right wing think tanks circa 1950's to the 70's when it was determined that labour was getting too much of their efforts returned to them in the way of wages wheras all wealth should belong to the owners of capital. The manifesto was roughly this:

Delete unions

Globalisation of jobs (however was not defined as such at the time but was based on cheap labour of any sort)

Delete borders for capital (create more disruption in 3rd world countries)

Cut wages by any means possible, eg via deleted unions and globalisation

Workers who needed more money for what ever reason to borrow more easily which was to make them more beholden to the system.

Give the bankers all the freedom they needed.

etc etc

Which has already played out to perfection, however what they did not do was allow for flaws in the case on account of it was to be the perfect world where the rich were rich and the workers obedient and they had no ongoing plan for what to do once they had achieved this, nor did they expect that the bankers freedom would lead to where we are today, that is, they let greed at the top run rampant.

Strokes white pussy

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Which makes the headline "No Wage Growth In UK" sensationalism

Not really when in real terms it's fallen drastically over 10 + years.

You're obviously one of the lucky few.

However for most any significant pay rise involves jumping ships. The days of pay rises and promotions for working hard and doing a good job are long gone for most.

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Not really when in real terms it's fallen drastically over 10 + years.

You're obviously one of the lucky few.

However for most any significant pay rise involves jumping ships. The days of pay rises and promotions for working hard and doing a good job are long gone for most.

Iv got a small Final Salary deferred pension with a top 10 FTSE company.In the last 10 years the deferred pension has gone up (RPI) faster than the pay increases of the people still working there.One year they got 0% and the pension went up 3.3%.Its gone up faster than the pay every year.

In affect i will get a much bigger pension for the 14 years i did at the company than the people still there will get for the same 14 years.

I was better off leaving.

The welfare system is the same.Benefits have increased far faster than wages.

There is very little point working in the UK anyway.The days of seeing your standard of living increase slowly with RPI+1% wage increases is over.

Edited by durhamborn

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Which makes the headline "No Wage Growth In UK" sensationalism

You do realise that if average pay growth is less than 2% there will be people who experiencing less than the average – many have seen their wages fall.

Now go and tell them that what they are experiencing is "sensationalism".

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Good and accurate point ^^ work does not pay for most workers....there is no ladder to above inflation pay increases or promotion in job increases for most workers.....anyway more to the point many who are stuck in a dead end jobs are also stuck in a dead end homes.....no way out, for them...knuckle down and get on with it.....victims of circumstance.

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Good and accurate point ^^ work does not pay for most workers....there is no ladder to above inflation pay increases or promotion in job increases for most workers.....anyway more to the point many who are stuck in a dead end jobs are also stuck in a dead end homes.....no way out, for them...knuckle down and get on with it.....victims of circumstance.

It was always the unspoken way that wages went up by broadly RPI+1% over the cycle.The job of business was to increase productivity alongside that to increase earnings to the capital owners.This ensured people had to accept changes in ways of working etc if they wanted to see an increase in their standard of living going forward.

That has now broken down.The first few years it sees massive gains go to the top.It then sees a breakdown in productivity as workers see no connection to their standard of living and the business.

Those huge mortgages are as we all know on here simply long term renting from banks in this scenario.

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It was always the unspoken way that wages went up by broadly RPI+1% over the cycle.The job of business was to increase productivity alongside that to increase earnings to the capital owners.This ensured people had to accept changes in ways of working etc if they wanted to see an increase in their standard of living going forward.

That has now broken down.The first few years it sees massive gains go to the top.It then sees a breakdown in productivity as workers see no connection to their standard of living and the business.

Those huge mortgages are as we all know on here simply long term renting from banks in this scenario.

Many years of mergers and acquisitions....dicing and slicing, cutting and shaving....profits for the investors and those that make the cutting decisions.... not for the people that make the business, people (and debt badly spent) are a cost that have often been used and taken advantage of far too often.......easily replaced for less......the balance has over swung in a damaging way.........constant annual growth was the name of the game, a game that is now in reverse for badly run and zombie businesses..........

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Which makes the headline "No Wage Growth In UK" sensationalism

Quite the reverse, because if you are the outlier and the average is very low the MAJORITY of the working population are getting next to nothing.

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Homeowners are getting a ginormous "tax credit" via HPI

Were it not for HPI think we would be seeing a lot more strikes and 70's style dispruption.

For example the Junior Doctors. Well paid relative to most of population but many will be struggling to get on the property ladder to claim their 'tax rebate' in the form of HPI

For the renter serf's there is always Wonga

Edited by RentierParadisio

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Frugal, there have been promotions but promotions aside, I got 5% last June with no promotion and before that 6% year before with no promotion.

My payrises for promotion have not been greatly different to usual pay rises.

OK so taking your word for it - I ask again - have starting salaries increased by 5-6% compounded at your place over the last 8 years?

And I also ask again, where can I apply?!

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Welfare is making up a lot of the difference. A low paid worker can look forward to a whole gamut of goodies from tax credit. Also worker participation probably skews the wage thing down a bit. Part timers and the self employed through choice and indeed because the old jobs are being destroyed. Then we have retirees on the triple lock, so taking up an increasing share of the GNI pie.

Edited by crashmonitor

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I agree, but that statement "no wage growth" is wrong. "Average wage growth is 0%" etc would be more accurate

Quite the reverse, because if you are the outlier and the average is very low the MAJORITY of the working population are getting next to nothing.

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