Teachers, nurses and other labourers on low and middle salaries have seen their wages fall by thousands of pounds in recent times, a new study reveals.
A study by the House of Commons Library discovered employees in public and private sector had been hit by the slow growth of wages and a decline in in-work assistance.
The decrease in universal credit is also dropping the biggest on women and ethnic youths, according to Government documents collected by shadow work and pensions secretary Debbie Abrahams.
Ms Abrahams is now asking for the roll out of universal credit to be halted, accusing the new policy of part of the slump in people’s incomes.
The Government said universal credit gave more assistance to people in work and it had proposed bills such as the national living wage.
But Labour’s requests to renew universal credit were supported by charity Citizens Advice, which stated it had served thousands of people with debt problems.
Ms Abrahams responded: “It is shocking that most people on low and middle incomes are no better off than they were five years ago, and in some cases, they are worse off.
“The Government’s cuts to in-work support of both tax credits and universal credit are having a dramatic effect on people’s lives, on top of stagnating wages and rising prices.
“It’s no wonder we see record levels of in-work poverty, now standing at a shocking 7.4 million people.
“These analyses make clear that the Government’s abject failure on living standards will get dramatically worse if universal credit is rolled out in its current form.”
A Government spokesperson stated: “We are committed to helping people improve their lives and raise their incomes.
“Universal credit (UC) does that by providing additional tailored support not available under the old benefit system, including more help for those in work so they can eventually stop claiming benefits altogether, and under UC people are moving into work faster and staying in work longer than under the previous system.
“Earlier this year, we made the rate at which universal credit is withdrawn more generous, so people keep more of what they earn as they move into work, which is set to help around three million families across the country.
“We are also raising people’s take-home pay by introducing the national living wage worth £1,400 extra a year, and cutting taxes for 31 million people.”