High wages can drive high productivity; but under the Conservative Government, wages in the North West fell by 0.8% per year in real terms compared to a rise of 1% from 2002 to 2010

Britain needs a pay rise. But under the Tories, workers have suffered a pay cut. Average real wages and productivity have stagnated.

To boost productivity requires investment in skills, infrastructure, R&D, access to finance by firms and a range of other factors.

But there is evidence raising wages helps raise productivity too.

This is because it acts as a spur to firms to invest in new technology and training, boosting productivity and maintaining profitability. It also helps to reduce turnover of workers, motivate staff and foster loyalty to the firm, again helping raise productivity.

While wages increased consistently under the last Labour government, they have stagnated under the Tories and the evidence shows no sign of recovery. Here in Bootle, under a Labour government, wages grew by 1 per cent, in real terms, between 2002 and 2010. But since the Conservatives came to power in 2010, fell 0.8 per cent, in real terms.

Labour would act to boost the wages of workers, including the introduction of a £10 Real Living Wage by 2020.

Peter Dowd, Member of Parliament for Bootle says “To boost productivity and help the economy, we must boost workers’ wages.”

“The Conservative Government are letting the people of my constituency down, its time the Government paid a real living wage so people in Bootle can afford to live a decent life as well as not having to worry about how they’re going to pay there next bill. Instead the Government are allowing the hardest workers in society to suffer on low pay whilst wages in real terms continue to fall.”

Rebecca Long-Bailey, Shadow Secretary of State for Business, Energy and Industrial Strategy, said:

“It is a sign of the Government’s complete economic failure that productivity and real wages are lower now, than 2007.

“Raising productivity is a complex issue and will involve measures which include increasing private and public investment in skills, capital and R&D, access to finance for firms. But boosting wages is key too. Higher wages act as a spur for firms to invest in new technology and skills so as to become more productive and maintain profitability.

“Labour plans to take measures to boost wages, including the £10 an hour minimum wage by 2020.”

Jack Dromey, Shadow Minister for Labour, said:

“Britain needs a pay rise. Our economy and our country cannot succeed on low wages and low productivity.

“The Tories have let Britain and British workers down. Under the last Labour government, wages went up year-on-year. However under the Tories, wages have declined in real terms.

“The evidence is clear – Britain will only succeed in the global marketplace as a high-wage, high-productivity, high-quality country, with Labour in government.”

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