Average family unit earnings in the South East are about 25% higher than in the West Midlands as indicated by a noteworthy new research of poverty and inequality.
The report found that average earnings in the West Midlands, East Midlands, Northern England and Wales were no bigger than the earnings in the South East in the late 1990s.
The Institute for Fiscal Studies (IFS) likewise distinguished low wage growth – with employment pay in 2015 to 2016 below its pre-recession levels – as “the primary reason for the malaise in living standards” in the UK.
The IFS study demonstrated that the average week by week wage net of taxes and benefits for a couple with no child in the West Midlands over the three years from 2013-14 to 2015-16 was £427.50 before lodging costs or £370.07 after housing costs.
For the South East, the numbers were £531.89 before lodging costs or £454.62 after lodging costs.
The report was supported by the Joseph Rowntree Foundation, whose CEO Campbell Robb said the revelations were “alarming”.
The research said:
:: Average earnings in the south of England and Scotland have grown quicker than in Britain overall in the course of the recent 40 years. Southern England is presently 13% over the national average, contrasted with 7% in the 1970s.
:: One of every four poor kids live in the most deprived 10% of local authorities.
:: Inequality remains lower than before the Great Recession, with the significant decline between 2007-8 and 2011-12 because of rising benefit salary and falling real income.
:: Salary imbalance is probably going to increment over the coming years if earnings grow and the planned benefit cuts “significantly reduce the incomes of low-income working age households”.
The Midlands has suffered gravely, the report revealed.
Having a little higher earnings than the average in the mid-1970s, average earnings in the East and West Midlands are presently 6% and 9% lower than the national average.
Mr Robb said: “These alarming figures highlight how far behind some parts of the UK have fallen, with millions of people seeing their incomes stagnate or even worse decline. Rebalancing our lopsided economy must be a priority if we are to create a country that works for all.
“Average incomes in the Midlands, Wales and the north of England have fallen further behind the rest of the country.
“Low earnings are an increasingly important driver of poverty, with the proportion of children in poverty in working households rising sharply in recent years.
“The Government must make urgent progress with its industrial strategy, working across party times to deliver a plan that drives up skills and productivity across the country. That will deliver more and better jobs and higher living standards that people desperately need.”
Uncertainties look into financial specialist Agnes Norris Keiller, one of the creators of the report, stated: “There are important gaps between the average incomes of different regions, though inequalities within regions are far larger than those between them.
“While London remains the most unequal part of the country, inequality in the capital has seen a dramatic decline over the last decade.”
A spokesperson for the treasury said: ‘We are building an economy that works for everyone by sharing prosperity and opportunity throughout the UK so nobody is held back because of where they come from.
“We have recently agreed seven devolution deals worth £4.8 billion, giving local leaders extra money and powers to create jobs, boost skills, build homes and improve local transport.
“Our National Living Wage is also helping to deliver the fastest pay rise in 20 years for the lowest paid across our country.”
However, Liberal Democrat welfare spokesman Stephen Lloyd said: “This report shows for the first time we are creating geographical ghettos of poverty that are trapping a generation of people and their children.”