New research has found the average person living in the UK would need to see their pay increase by £3,500 to deal with the current rate of inflation.
RIFT Tax Refunds conducted the study looking at how workers can cope with rising prices and how inflation affects the amount of tax they pay.
The average UK gross salary is £37,235, but inflation is currently at 9.4% and is squeezing down monthly pay packets, leaving workers struggling to manage.
Researchers found the average person would need a £3,500 pay rise to keep up with this rate of inflation, which would increase tax bills by £1,164 a year, but also leave an additional £2,336 in workers’ back pockets.
CEO of RIFT Tax Refunds, Bradley Post, said: ‘Many households are struggling to combat the increased cost of living due to the current rate of inflation, with many attempting to do so on a stagnant level of income that hasn’t seen the same level of growth.
‘In fact, in order to match this pace, the average person would need to see quite a considerable boost to their annual earnings to the tune of £3,500.
‘However, the unfortunate reality is that many simply won’t and this will leave them at a severe disadvantage when it comes to managing their household finances.’
The average teacher would need to earn an extra £3,331 per year to keep up with inflation, allowing them to take an additional £2,223 after tax, while construction workers need a pay rise of £3,074 a year, boosting annual net income by £2,053.
The Office for National Statistics released figures today showing that regular pay fell by a record 3% in the quarter to June when adjusted for inflation.
Numbers of job vacancies have also declined for the first time in two years, falling by 19,800 to 1.274m vacancies.
Coupled with this is the 11.6% rise in supermarket prices, meaning food bills on average will grow by £533 a year or the equivalent of more than £10 a week.
Photo by Marten Bjork