The UK is facing an unprecedented cost of living crisis, with inflation reaching a record high of 9% in April.
It means the price of goods and services a typical consumer might buy were on average 9% higher compared to April 2021 – and if salaries do not keep up, workers will get less for their money.
Analysis of Office for National Statistics (ONS) Pay as You Earn (PAYE) data by NationalWorld has found workers in every part of the UK had a real-terms pay cut this April compared to last, with earnings around 3% lower on average after adjusting for inflation.
In some parts of the country employees were out of pocket by up to £150 per month, with the average loss standing at £66. The figures exclude self-employed people, and capture bonuses as well as regular pay.
You can find out how salaries held up in your local area in our interactive map here.
But how much would you have to earn now compared to last year to avoid suffering a pay cut?
Our real-terms salary calculator below will show you how much your take-home pay will have had to increase to keep up with inflation – and how out of pocket you are if your wages have stood still.
What is inflation?
Inflation is calculated monthly by the ONS.
The main measure – and the one that has reached 9%, the highest rate since current records began in 1989 – is the Consumer Prices Index (CPI).
If a pint of milk cost £1 last April but £1.05 this April, milk inflation would be at 5%.
The ONS measures price rises across a huge ‘basket’ of goods and services to work out the overall pace of inflation, but gives higher or lower precedence to some items in the basket depending on how important they are or how much we spend on them.
A 10% increase in the price of petrol for instance would have a much bigger impact on the price of the overall basket compared to a 10% increase for tea bags, because consumers typically spend more on petrol than tea.
Calculations by the Institute for Fiscal Studies (IFS) however show the poorest households – who spend a bigger chunk of their income on food and energy, and less on non-essential things – faced inflation of up to 10.9% in April.
Inflation for the richest households meanwhile stood at 7.9%, the IFS said.
How big has your pay cut been in real-terms?
With inflation at 9%, a worker who took home £1,000 per month after tax and other deductions last April would have had to earn £1,089.92 in their pay packet this April for their pay to have remained stable.
Our salary calculator below will show you how much you need to be taking home now compared to last year if your pay is to keep up with inflation.
Type in what you earned after tax and deductions in April last year to find out the equivalent figure in April 2022 prices.
The calculator does not take into account National Insurance, and many people’s contributions increased last month.
Which parts of the UK have been worst hit?
Scotland and Wales are the UK regions where workers endured the worst pay cuts in the last year, with wages falling by 4.4% in real terms.
In some areas workers saw pay cuts of more than 6%.
You can find out the local areas where workers have experienced the biggest pay cuts here.