The UK is set to see the longest fall in living standards in 60 years, according to the Resolution Foundation.
The think tank has said that disposable incomes in the UK are set to fall for 19 successive quarters, longer than the squeeze seen in the aftermath of the 2008 financial crash, as reported by BBC News.
The Resolution Foundation, a not-for-profit research and policy organisation focusing on people on low incomes, said the UK economy is set to be £42bn smaller in 2022 than previously forecast.
The country’s growth predictions were cut on Wednesday by the Office for Budget Responsibility, which reduced projected growth from 2% to 1.5%. Growth for the next five years is expected to be under 2%.
The Resolution Foundation said the abolition of stamp duty for first-time buyers of property under £300,000 is is unlikely to be effective in addressing the housing crisis. The £3bn cost of the measure will deliver savings on a small number of purchases, working out at a cost of £160,000 per extra homeowner. The same money could have built 140,000 new homes.
The think tank was critical of the Chancellor’s budget package, saying it would mean losses of £715 per year for the poorest third of households while the richest third would gain £185.
The slow pace of productivity growth is a key area of concern for economists. The average has been revised down by around 0.7% per year until 2023.