Latest Asda Income Tracker finds that household spending power fell again last month
The supermarket found that disposable income was down £6 per week from its February 2010 peak.
Asda said that slow pay growth and the 1% cap on working age benefits were again key factors behind the month’s year-on-year decline, with average pay excluding bonuses up just 1% in the three months to August.
Further adding to the squeeze on household budgets was the cost of food, which rose by 4.1% in August, the highest rate for three months. The cost of food for the average UK household has gone up by £655 over the last five years, to £3,085 a year, Asda found. It is expected to increase by a further 15.2% by 2018.
Asda president and chief executive Andy Clarke said: "The positive news is that the UK is finally heading in the right direction along the road to economic recovery – but we can’t ignore the fact that this improvement hasn’t yet translated in real terms to more disposable income for families.
“The economic reality is also very different across the regions and the benefits of the recovery will only be fully realised when actions are taken to reduce this structural deficit.
“The income tracker is a core driver in helping us to understand and respond to the changing needs of consumers across the country and we are aware that rising food prices are a primary concern in the continued squeeze on budgets. We are investing heavily to keep this inflation at bay and encourage other retailers to take the same action in a bid to return the real pound to the pockets of consumers.”
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