A finance guru has given his worrying verdict over inflation and wages in the UK – and it makes for grim reading.
We all know that the cost of living crisis and crippling inflation rates have seen the cost of food, mortgages, petrol, gas and electricity and many other things skyrocket over the past few years – while wages haven’t.
But one Redditor has calculated the appalling loss of spending power he claims most households have faced since the year 2000 – and how much money you’d need to earn to keep up with it.
While the Bank of England calculates that a median wage of £16,000 in the year 2000 would be £29,479, the user explains that he’s taken more costs into account, such as the quintupling of house prices.
@theminoxman said: “Like many of you, I’ve heard from a lot of older people in my life that a salary in the low 30s should be considered a good one, as this was a good wage growing up.
“I live in the north west, and the median wage was £16,000 in the year 2000. It’s now about £29,000. If you include inflation around all areas of live, would anyone like to guess what a £35k salary in the year 2000 would look like now in the north west?
£112,000. This might sound like a wildly inflated figure, but this factors in everything from fiscal drag and exploding housing costs to more expensive transport and food to childcare.
“On average the average house in the north west wa £50,000 in 2000. It’s now over £150,000. In the last 24 years, mortgages went from about 3.2 times the median income to over 5 times the median income.
“It’s staggering when you sit and think about it, and it explains so much of the current economic issues people find themselves in.”
While some weren’t sure about his maths, others backed it.
@diademinsomniac said: “I’d believe this. In 2000 I was earning £24,000 living in the midlands fresh out of uni and felt pretty well off, bought my first house and lived with my partner who was only working part time and we felt pretty well off, meals out, holidays abroad etc, new car…
“Earning 90k now and honestly feel worse off than back then so I’d say those numbers are not far off at all.”
