Middle-income households saw solid living standards gains in 2016-17 – but that growth is slowing

Published on Incomes and Inequality


Commenting on the latest Households Below Average Income (HBAI) survey for 2016-17, published  today (Thursday) by the Department for Work and Pensions, Adam Corlett, Senior Economic Analyst at the Resolution Foundation, said:

“Today’s household income survey – the most comprehensive we have – shows that typical households saw solid income growth of 2 per cent in 2016-17.

“This very welcome growth was driven by the backdrop of very low inflation and rising employment last year – tailwinds that feel a world away from recent months of above target inflation and high but plateauing employment. While inequality remains broadly flat post-crisis, it is also concerning that relative child poverty has risen for five years in a row – a pattern that risks continuing over the coming years.

“More-up-to-date official figures on pay, prices and employment suggest that income growth has since slowed, particularly for poorer households who are most affected by the cash freeze in working age benefits that is saving around £2.5bn in the coming financial year alone.

“Getting household income growth back on track is the single biggest domestic challenge facing the government in this parliament.”