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UK to face jobs, living standards and public service pressures under new PM

The BBC says living standards gains have slowed to about half the pace seen from 1990 to 2007, leaving households thousands of pounds worse off than they otherwise could be.

Reported · Written up by our desk · North America

Andy Burnham is set to become the UK's fifth prime minister in four years, but the BBC reports that the underlying economic challenges for the new government are largely unchanged. Those include weak job opportunities, stagnant living standards, and pressured public services as voters look for faster improvements.

The BBC points to a shift in how quickly households have been getting better off, noting that between 1990 and 2007 the average person improved by roughly 2.5% per year, while since then progress has been about half that rate. It also cites a lack of public and private investment after the austerity period and following Brexit, which it says has weighed on productivity.

Food prices have also risen sharply, with the BBC saying they have jumped by 40% in just a few years, squeezing finances. While the UK has been hit less than once feared by the US-Israel war with Iran, the BBC describes the focus as needing to raise economic growth in a sustainable way, alongside more investment and skills.

The BBC adds that hiring is at its lowest level for five years, with young people particularly affected, and links the hiring weakness partly to automation and government policies, including higher national minimum wages and taxes. It also highlights a report by former Labour minister Alan Milburn warning that NEETs could reach one in six young people, with the second report part and policy recommendations due later in the year.

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