Consultancy firm PwC has warned that 2023 looks set to be difficult in many ways for workers in the UK. It said that wages will fall back to where they were in 2006 and there will be a slide in house prices and an increase in divorces.
According to PwC, in 2023 UK workers will have to deal with:
- Higher taxes - Income tax thresholds will be frozen from next April and energy subsidies will be cut
- House price fall - An 8% decline in house prices is predicted which is bad news for home owners but the high interest rates mean that people trying to get on the housing market will not be able to take advantage of the cheaper houses. PwC forecasts there will be fewer than 1 million housing market transactions for the first time in a decade.
- More divorces - There will be a 20% rise in the rate of people getting divorced and PwC predicts there will be around 16 divorces every hour in 2023 - the introduction of no-fault divorces in April 2022 is a factor in this.
- Cost of living crisis - The average real wage will drop from 2020's peak of £36,330 to £34,643 next year, the lowest since 2006.
- Rising unemployment - The CBI has predicted that unemployment will rise from its current rate of 3.6% to peak at 5% in late 2023.
Senior economist at PwC Barret Kupelian, said the UK faced “a highly challenging” year. “It is not surprising that these chilly headwinds will continue throughout 2023, bringing with it some unwelcome milestones in terms of economic and social wellbeing measures,” he added.
He ended on a lighter note by predicting that things might look brighter by the end of 2023 with a fall in inflation, a more settled outlook for the global economy and a rise in immigration to bring much needed skilled workers and add £19bn to the economic output of the UK.
