As the latest labour market statistics show, the 2017 general election will be fought with prices rising faster than pay. Only in two years in the past decade have real wages risen, and then only because inflation was unusually low as a result of the collapse of oil prices. Depending on how the economy performs during the Brexit negotiations, it could be worse than that. For the trend to be reversed, though, the economy will need to run a lot hotter and at substantially lower levels of unemployment. That goes a long way to explaining why earnings growth has been so weak.

Source: The Guardian May 17, 2017 18:45 UTC