As the U.K. set out plans to spend billions on infrastructure and scrap its budget surplus target, analysts warned UK workers are about to face the biggest squeeze on wages in 70 years.
The Institute for Fiscal Studies said UK workers will be earning less in real wages in 2021 than they did in 2008.
"One cannot stress enough how dreadful that is – more than a decade without real earnings growth. We have certainly not seen a period remotely like it in the last 70 years," Paul Johnson, director of the IFS said Thursday.
Real average earnings are set to increase by less than 5 percent between now and 2021. This means that wages in 2021 will still be about 3.7 percent lower in 2021 compared to their pre-crisis level, data from the Office for Budget Responsibility showed.
The OBR is expecting inflation to reach 2.3 percent and the economy to expand by 1.4 percent next year.
"If the real wage is not going to grow for 13 years, that's going to be a grind," Tom Harris, chief executive officer of Harris Capital, told CNBC on Friday.
"Joe is carrying a lot of debt in his or her pockets," Harris added.
The total outstanding debt owed by individuals in the U.K. topped £1.503 trillion ($1.87 trillion) at the end of September, up from £1.451 trillion a year ago, according to data from The Money Charity, which advises people how to manage their money and debt. The average debt per adult stands at £29,770 in September, around 113.7 percent of average earnings.
Having "to learn to live within their means, is very much the way to go," Harris also told CNBC.