Average UK family worse off than during recession as wages slow

London: The average family in Britain has £14 (Dh80.09) less to spend each week than they did a year ago, according to supermarket chain Asda, as slow wage growth and high inflation leave people worse off than they were during the recession.

Asda's monthly "income tracker" data showed that the average family's weekly disposable income (after taxes and essentials) fell by 7.9 per cent in August — the biggest decline since the supermarket's records began in January 2007.

Since consumer spending accounts for about two-thirds of the UK's GDP, the figures underline the problems facing the economy as well as the country's retailers. Separate data from the CBI business lobby showed that sales on the high-street were broadly similar in September to August but remain much weaker than a year ago.

While 24 per cent of the retailers surveyed said sales were better than a year ago, 39 per cent said they were worse. This was the worst balance since May 2010. The three-month moving average, a smoother measure of the sales trend, was the weakest since the summer of 2009.

"High-street sales are sluggish but appear to be stabilising," said Judith McKenna, who chairs the CBI survey panel and is Asda's chief operating officer.

"With the consumer squeeze set to get tighter with the winter utility bills rise, we expect retailers will face a challenging October."

Chris Williamson, economist at Markit, said the CBI survey "adds to a growing body of evidence which suggests that retailers will enter the all-important final quarter of the year fighting for business in the face of weak consumer confidence".

— Financial Times