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Earning more and going nowhere

Keeping up with the cost of living is a tough thing to do, with the average worker needing to earn 5 percent more to keep up with it.

The Joseph Rowntree Foundation has calculated that for a family with two kids in which both adults work, an extra 24 percent income will need to be found in order to comply with the 'minimum standard of living.' This is a standard that allows you to do most regular things, but excludes extravagances.

Donald Hirsch from the Centre for Research in Social Policy at Loughborough University, said: 'This shows that the squeeze in living standards caused by the combination of rising prices and stagnant incomes is hitting people on low incomes hard.

'This is partly because the prices of certain essentials like food have risen, but also because of policy decisions that have reduced what families have to live on. In particular, the reduction in support for childcare has made many low-earning families worse off. In the process, for families who need to use childcare, it has substantially reduced the incentive to work on relatively low pay.'

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