UK will face pay squeeze this year as inflation spikes, warns thinktank

NIESR says inflation will rise to 3.4%, well above OBR forecast, prompting real-terms cut in takehome pay

British workers will see their disposable incomes shrinking this year as a result of rising inflation that will peak at 3.4%, a leading economic thinktank has warned.

The National Institute of Economic & Social Research said that wage rises would be capped at only 2.7% on average, leaving workers to face the largest real-terms cut in their takehome pay since early 2014.

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