Households in the UK saw their average take-home incomes fall by 3.1 per cent in 2010-11, new research has shown.
Data from the Institute for Fiscal Studies (IFS) showed that this was actually the first fall for five years and was the biggest drop since 1981 with the belated effect of the recession between 2008 and 2010 being blamed.
Jonathan Cribb from the IFS said: “The fall in median income in 2010-11 of 3.1% was the largest one-year fall since 1981 and returned it to the level last seen in 2004-05.”
“This was driven largely by a decline in real earnings, as the impact of the late 2000s recession on incomes finally started to become clear.”
The IFS also revealed that the impact of the fall in incomes recorded during 2010-11 was felt across families of all backgrounds.
Indeed, the Institute said that the richest households had suffered bigger falls in their incomes than those in poorer households.