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Typical pay in Scotland outstrips England for first time

Published 17/01/2016

New figures have shown that typical pay in Scotland is greater than in England for the first time
New figures have shown that typical pay in Scotland is greater than in England for the first time

Typical pay in Scotland is higher than it is in England for the first time on record, a think tank has revealed.

Workers in Scotland typically receive £11.92 an hour, compared with £11.84 south of the border, according to the Resolution Foundation.

Analysis by the independent think tank found pay in Scotland had grown faster than any other part of the UK over the last two years.

In 2004, typical hourly pay in Scotland was 7.2% lower than in England but strong growth in the middle of the last decade reduced the gap to 2.9% by 2009 - the year that real earning peaked.

While wages were squeezed during the recession, this was less severe in Scotland, helping the gap narrow further.

The findings were released ahead of a major new report from the Resolution Foundation on The State of Working Scotland, which will be published later this week.

The think tank argued steady growth, high employment and improved productivity in the early and mid 2000s were likely to have been the driver of Scotland's strong performance on pay prior to the recession.

When the recession hit, workers in Scotland suffered less as a result of the squeeze on wages but it had sharper falls in employment, the foundation added.

For Scotland to maintain its pay advantage over England, the think tank said a return to strong jobs growth is essential, adding action to boost employment should be key in this year's Holyrood election.

It also called for action to improve pay for the one in five Scottish workers who earn less than the low pay threshold.

C onor D'Arcy, policy analyst at the Resolution Foundation, said: " As recently as a decade ago, typical workers in England earned significantly more than their counterparts in Scotland.

"But years of stronger pay growth in Scotland means that the English pay premium has now become the Scottish pay premium for the first time ever.

"Scotland's impressive pay performance has been underpinned by high employment and steady economic growth, particularly in the run-up to the crash. But its recent employment and growth record has been less impressive.

"While Scotland's strong pay growth has been good news for many workers, it is still the case that one in five employees are low-paid.

"With the higher minimum wage for the over-25s expected to reduce rather than eliminate low pay, tackling this long-standing problem should be a top priority for parties in the run-up to May's election."

A UK Government spokesman said: "Our long term economic plan has created the conditions under which Scotland is thriving as part of the UK.

"The new national living wage will provide a further boost - up to 230,000 people in Scotland are expected to benefit by 2020 once it is introduced in April this year.

"The analysis by the Resolution Foundation shows that Scotland is better off as part of the UK, which is why we are committed to delivering the Smith agreement in full, ensuring that Scotland and the rest of the UK continues to thrive."

A Scottish Labour spokesman said: "This report also highlights that one in five Scottish workers is paid below the living wage limit.

"Scottish Labour is committed to improving the earnings of low paid workers, people like care staff. When this issue has been put to the test in the Scottish Parliament the SNP has failed to give support.

"That's why the only way for low paid workers to get the living wage is for them to vote for Scottish Labour in May."

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