2020s could be 'first decade of modern era to witness no improvement in disposable incomes across Britain'

Think tank says living standards outlook for the second half of this decade is 'bleak' for most

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UK households face a 'bleak' living standards outlook for the remainder of the 2020s, according to a think tank.

The Resolution Foundation also says the tough start to the decade contributes to the risk that some could end up no better off by 2030 than they were a decade earlier.

It said that the 'bust, boom and bleak outlook' seen this decade could leave the 2020s "as the first decade of the modern era to witness no improvement in disposable incomes across Britain".

In its 'central scenario, the typical annual real income of non-pensioners is set to grow 'only slightly' over the five years after 2024-25, by one per cent overall, or a cash increase of around £300.

Its report said: "Our outlook for 2025-26 specifically remains poor with income flat (zero per cent growth)."

The Living Standards Outlook 2025, funded by Nationwide Building Society, said that frozen tax thresholds and rising council tax are 'cancelling out real pre-tax earnings growth for many, even before accounting for water, rent and mortgage rises.' The report continued: "Taking into account the cost-of-living crisis, the typical income in 2029-30 would remain essentially unchanged compared to 2019-20.