According to the study conducted this month, the average family will borrow a further £685 this Christmas to pay the added costs of the festive season, which will take a monumental 24 weeks on an average salary to clear, the organisation has cited.
Consumer borrowing is already up on last year, with the £685 estimate around 5% higher than the £654 borrowed per family last year. Furthermore, a similar formula using average weekly income and savings information from last year found that people in 2012 only took 20 weeks to clear their debt, a month lower than the equivalent estimate this year.
The total level of consumer debt has risen by almost 5% this year, with people on a minimum wage salary shockingly predicted to take almost a year to clear debt acquired during the Christmas period.
The Trade Unions Congress has argued that the study is a clear indication that there has been a break between living standards and economic growth, with recent positive forecasts on the economy clearly not being matched by the wealth of the average UK household.
Instead, they have argued, they are being hit with higher levels of liabilities that they are struggling to cope with, with the value of their wages constantly in decline due to a quicker rate of inflation compared to wage increase and the ever rising cost of living.
The TUC have called for the government to devote more time to instigating fairer pay rewards, so that the value of actual wages begin to catch up with product prices and the general cost of living.
Inflation has increased at a rate faster than wage rises for a total of 42 consecutive months now, with the TUC arguing that it was the worse wage squeeze in the country in almost 150 years.
This sentiment has been reiterated by the Bank of England, who have identified that the current levels of household debt are both alarming and burdening for those who possess it.
Nicola Smith, head of economic and social affairs at the TUC, said: “It’s to do with the fact that is an expensive time of the year for everybody, and with wages hardly having not kept up with prices for the last four years, with family incomes under historic pressure, just meeting the basic costs of Christmas is going to mean a lot more people having to rely on credit if they are going to cover the fuel bills that are going up, food, the price of which is rising far faster than their pay packet.”
Mrs Smith argued that the positive forecasts on the economy were based on the levels of consumer spending, but because this is being propped up by debt, it was misleading and meant the economy was improving at the expense of public debt levels.