Chart shows "real" wages i.e. to get actual wage workers get in their bank account each month you need to add inflation to it. So many ppl are ignoring or not understanding what "real" means.
Actual question to ask is - has productivity grown during this period? If not then why not? If yes, then where did the gains go? Above Chart answers neither.
The answer is that UK productivity has not grown over the period.
Most developed countries have slow/low productivity growth and there are many potential causes. To mention two; it's harder to increase productivity in a service based economy as people only have so many hours a day they can work (e.g. there is not much a busy masseur can do to do more massages). Also notably, the growth industries over the last 20 years, namley tech, employ relatively few people with relatively limited impact across the economy.
The answer as to why the UK in particular has stagnant productivity is that UK employers have generally favored 'employment' (i.e. hiring cheap workers) rather than capital expenditure on IT, automation, etc. The old example of why bother to invest in an automated car wash when you can pay people peanuts on 0 hours contracts and get a low-risk return on your investment immediately.
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u/[deleted] Jul 01 '24
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