WORKERS in their 30s are earning £2,100 less a year than people who were their age when the financial crisis hit a decade ago.
In fact, with the average salary still sitting seven per cent below its pre-crisis peak, today’s 30-39-year-olds are the ones that were hit the hardest by the recession.
They saw their wages fall by a whopping 11 per cent after the financial crisis hit in 2008, a fall which has left their earnings “permanently scarred”, a new report by the Resolution Foundation think tank says.
Overall, the average pay levels for all workers also remain three per cent lower than pre-crisis levels.
The youngest workers were hit the hardest because they had their first jobs as the economy went south, meaning many employers cut down on recruitment drives or offered lower salaries to those starting out.
Meanwhile, pensions are often also considered less reliant on pay.
Yet there are now signs of strengthening pay for those in their 20s today, with wages across the UK increasing again.
In its latest Earnings Outlook, the Resolution Foundation also found that workers who ditched their current employer and moved jobs received a 4.5 per cent pay increase on average, compared to only 0.5 per cent for those who stayed loyal.
Nye Cominetti, economic analyst at the Resolution Foundation, said: “Young people are often hit hardest in recessions.
“In the wake of the financial crisis young people received a bigger hit to their pay packets than anyone else, with wages shrinking by more than 10 per cent between 2009 and 2014.”
How to ask for a pay rise
BELOW are ten top tips for negotiating a pay rise.
- Ask at a strategic time – for instance an annual performance review
- Be upfront and honest with your manager and explain your situation in a private meeting
- Be clear on your reasons for asking – have you taken on any new responsibilities?
- Be confident, you need to show that you believe you deserve any rise
- Highlight some key success points you have had over the past 12 months that have helped the company to achieve its objectives.
- If you think you’re underpaid, research what people within your job role are paid in your local area and bring these in to demonstrate to your manager
- Be specific about what salary you would like and how you came to that number
- Be ready to negotiate, and make sure you consider other perks such as flexible working
- Keep your emotionals in check. Make sure you stay professional at all times
- Be prepared to look elsewhere if a pay rise isn’t offered.
“This pay squeeze was particularly painful as it came at the start of their careers, when people usually move jobs frequently, gain new skills and see their earnings grow rapidly,” Cominetti added.
“As a result, workers who came of age during the financial crisis are now in their 30s, and are earning far less than thirtysomethings did before the crash.
“But an increasingly tight labour market is finally starting to deliver a pay recovery and whether this continues to build momentum in 2019 will depend in large on what happens with Brexit.”
Average earnings are at their highest level in a decade while record numbers of people are in work, it was revealed in December.
Some workers are also set for a pay rise in April 2019 – here’s all you need to know about it and the National Living Wage.
Meanwhile, a report says younger workers should be spared from paying National Insurance to help them catch up with wealthy older people, a report has said.
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