At What Point Will You Ask For A Pay Rise?
Have you felt the squeeze on your disposable income lately? Are you struggling to make ends meet? This is the situation for most people in the UK and abroad, yet due to the lack of jobs and the faltering economy many of us are reluctant to ask for a pay rise. At what point though does a pay rise become a necessity rather than a desire?
Caught Between A Rock And A Hard Place
Energy Bills, Rents, Food, Childcare, everything is on the up! Yesterday the Governor of the Bank of England Mervyn King said that the road to economic recovery would be long & winding and that inflation would likely stay above its 2% target for sometime to come. I don’t know if the Beatles play on words was supposed to make the situation seem less dire but the news won’t have helped the mood of many struggling families. Wages haven’t been increasing at anywhere near that rate, if increasing at all! Many workers also feel powerless to ask for a pay rise because they know there are thousands of jobless people out there who would be more than happy to take their job.
Cuts In Benefit Entitlements
On top of the rising cost of living and the lack of a pay rise, families are also being hit by cuts to benefit entitlements! Housing benefit & Tax credits have both faced cuts either directly through reduced entitlement or indirectly by not keeping pace with inflation. My sister is a self employed child minder who is also a single parent with 3 children. She has recently been hit by a sharp rise in energy costs coupled with a £100 a month cut to her benefits. Like many she is not in a position to manufacture a pay rise and is having to move house to be able to cope with the loss of benefit income.
Why A Pay Rise Could Make Your Situation Worse
You might think that a pay rise could relieve the financial strain you’re currently facing but the opposite may actually be true. Interest rates are currently at a historic low, protecting most from a financial catastrophe. Interest rates can only remain low if inflation is kept under control. If wages were to rise this would likely fuel inflation and force interest rates to rise. A rise in interest rates could be just the thing that sends our already teetering economy over the edge, causing even worse financial pain for most.
How Much More Can You Take?
I’d love to offer advice on how to get yourself a pay rise but I completely understand the dilemma that most hard working people face. Do I ask for a pay rise and risk heading to the top of the redundancy list, or struggle on and try to make even more spending cuts wherever possible? How much more can you take?