If your salary had kept up with inflation...

[OhamIreally]

In 2001 I got a job paying £42,000 per year. For me it felt like a really high salary and I was over the moon.
I've stayed in that industry full time, worked hard, changed jobs, taken promotion, more responsibility etc.

I thought I was climbing the career ladder and my pay was reflecting all the hard work over the years.

I've just done one of those inflation calculations up to 2021 - I am sure 2022 would be even more staggering- and it revealed my salary now, just keeping up with inflation, would be £72,500.

The calculator said £1,000 in 2001 would have the purchasing power of £1726.76 now.

I wish I'd stayed in 2001 with a lot less responsibility!!

I started a job a little over a year ago on £40k and was fair chuffed with myself and thought I've finally made it to earning enough that I don't have to worry about money. Now everything costs a million pounds and all I do is worry about money.

I went back to ft after mat leave and or for kids to what seemed like a huge salary. Thank fuck I did because

Gah. Because the extra is absorbing the increased mortgage, food, fuel, life. We would have been fucked otherwise.

Interesting question.

I've been promoted now, but if I was doing the same job oin 2008 on 28k now I would be on 40k had inflation kept up.

Yet in my company those roles are capped at 31k and that's the top of the banding. Lower band is 29k.

So similar skill set albeit different industry sextor and a 2-3 k rise in 14 years!

Luckily I got myself up the ladder and am earning closer to 50k now which is fine for me as I'm still developing at senior level.

My £38k London salary in 2009 would be £52k now. Just left freelance world and gone back to the same industry only up north .....£37k salary. Makes me want to cry. And leave.

Interesting post OP.

Has the cost of the service/products your company provides also gone up with inflation? Has the production cost gone up too? Have the company overheads gone up with inflation?

Unfortunately if you don’t get regular pay rises each year, your pay won’t keep up. My 2 adults sons think they’ve done really well this year each getting two 4% rises, when the past 2 years they only got one around 2.5%. They both have bonus schemes, but instead of treating this as a bonus, they incorporate it as a rise, they feel better this way.

I was thinking the same OP, after skimming the post on civil servants pay. I started a new job in 1999 on £38k with a fully expensed company car, final salary pension, healthcare etc. The car was an Audi A4, which maybe cost them £4K a year. The fuel was probably £2k a year. A final salary pension was probably costing them 25 ~ 30% of my salary, say £10k. So before NI that lot was £54k

The Bank of England inflation calculator reckons that’s £66,500 now just for the salary and £94,500 as a total package. I reckon that a similar job now might pay £60 to £70k, but more likely £55k. The car and fuel card would be gone, and a £500 car allowance taken its place. The pension would be defined contribution with a far lower employer % than the final salary one needed - probably 5 to 10% from them. So cost of package to the employer of maybe £66k. That’s a consequence of a period of very low inflation, a large increase in the labour pool over that time as there are far more graduates than there were in 2000, with immigration taking the slack at the bottom end. Combine that with employer subsidies at the bottom end introduced by Labour in the late 90s / early 2000s and you can see why real salaries in the middle have lagged across pretty much all sectors.

At the bottom end I’d guess people are better off in real terms, as benefits/tax credits/universal credit have put more money in those peoples pockets, and at the top end yes, salaries have gone up, but bonuses have gone up more I think.

Wages haven't kept up with inflation so you'd only be on about £45k now

OP doesn't say what they're paid now.

Which inflation calculator are people using?

I’m using the Bank of England one:

www.bankofengland.co.uk/monetary-policy/inflation/inflation-calculator

New graduate salaries outside financial services / central London have stood still (ie fell compared to inflation since 2006/7.

The job I had in 2003 pays the same now. Same with different jobs I had in the noughties.

Some public sector has risen a bit but nowhere near inflation.

The gdp per person has never got back to 2006/7 levels since the crash. I don't think it ever will again. The only reason gdp has gone up is a rising population.

Ie a bigger pie but with everyone getting smaller portions.

We have to plan for a zero growth future.

The other very scary thing to look at is the investing of cash versus house valuations.

Going back to mid 60s.

Even if you looked at what you could buy on an average starting AO civil service salary 20 years ago versus now.

My shit salary in 2013 would have me earning 22k now if I'd stayed in financial services as an administrator. Instead I'm earning over 100k in IT and I still wonder how I cope. I feel sad for the people I was working with then who didn't make the move.

About 5 years ago I was on £17500pa and currently on £32k. The only reason is because I changed jobs (same role, diff industry) and my current bosses try to follow inflation.

I live in Ireland.

My 22k salary in 2008 would still be just 25k today, no massive difference there.

If I compare my 2008 money to November 2021 instead of today, inflation had only brought it up to 23k, so the last year has made a big difference comparatively.

I'm a CS. In 2007 I was on £17k - that would now be equivalent to over £29k. I'm on £22k. But that realism won't go down well with those who still think we're all on final salary pension (not and never have been) with 6 months holiday and other ludicrous benefits. I'm getting out. 50% staff lost and not replaced. I'm burned out.

My starting salary was £15,500 in 2000 which at £1,726 per £1,000 is £26,753 and about right as starting salaries are £28k ish in my industry.

It puts six figure salaries into context.

It's worse when you consider the income tax bandings.