Calculate the pay rise YOU need to keep up with inflation and tax

An online calculator has been unveiled showing how much pay rise Britons need to keep up with inflation – after a Bank of England chief said people should ‘accept that they are worse off’ and stop asking for more money.

Employees can enter their salary into nous.co’s ‘Keeping Up With Inflation’ calculator to find out how much more money they need to maintain their standard of living.

Based on your salary, the calculator calculates someone’s personal inflation and the wage increase needed to maintain the same purchasing power each month, taking into account the tax they also have to pay on an increase.

It comes as BoE chief Huw Pill’s comments sparked outrage across the political spectrum.

A top City figure suggested he should ‘pull the brain before he spoke up’ and a business group described the chief economist as ‘astonishingly unattainable’.

Mr Pill, who receives £190,000 a year, said: ‘One way or another someone in the UK has to accept that they are worse off and stop trying to maintain their real purchasing power by driving up prices.’

He claimed this could be a result of staff demanding higher wages: “What we are dealing with is a reluctance to accept that we are all worse off and that we all have to do our share.”

Simon French, chief economist at investment bank Panmure Gordon, advised Mr Pill: ‘Just don’t say it. Economists need to engage their brains before they speak up – even though, from the perspective of avoiding a damaging price spiral, I understand why he says what he says.’

Andrew Bailey, the Bank’s governor, said last year that asking for higher salaries could prolong the inflationary spiral

Andrew Bailey, the Bank’s governor, also said last year that asking for higher salaries could prolong the inflationary spiral.

The comments from Mr Pill – a former Goldman Sachs economist who lives in a £1.5m stable house in West London’s Bayswater – are likely to be seen as highly insensitive when households and businesses are battered by the cost of living.

It came on the day when supermarket data showed that food price inflation was over 17 percent and shoppers are increasingly turning to own-brand products.

Critics argue the Bank is partly responsible for fueling galloping inflation – currently at 10.1 per cent – ​​by pumping hundreds of billions of pounds into the economy and failing to raise interest rates when prices went up.

It has embarked on an aggressive series of rate hikes, raising its base rate from 0.1% in December 2021 to 4.25% – with a forecast of 4.5% in May.

Read more: When will interest rates fall?

Interest rates have been raised to combat inflation and it is expected that the base rate can rise again to peak at 4.5 percent.

But the big question now is when interest rates will fall and how fast?

We look at the latest forecasts and analyses.

> READ MORE: When will interest rates fall?

Responding to Mr Pill’s remarks, Paul Nowak of the Trades Union Congress said: ‘Working people are facing the longest pay cut in 200 years.

“They don’t need lectures, they need a raise. Oil and gas giants are making eye-watering profits, CEO salaries are skyrocketing and banker bonuses are reaching record highs. It’s time for a plan to make sure the workers get their fair share – they shouldn’t be expected to take another blow to their standard of living.”

Martin McTague, of the Federation of Small Businesses, said the comments were “amazingly unreachable” at a time when small businesses had absorbed as much as possible.

Mr. Pill, an Oxford graduate and PhD from Stanford University in California, where Rishi Sunak attended business school, spoke in a Columbia Law School podcast.

He received a £7,662 relocation allowance when he joined the bank as Chief Economist in September 2021.

The latest figures published for the year to the end of February 2022 show he received £95,183 for his first six months in the job.

His comments on inflation acknowledged that it would be “natural” for households with higher utility bills to demand higher wages or for companies with higher costs to raise their prices.

But that was “ultimately self-defeating,” he argued, at a time when the UK was experiencing a trade shock, where the price of imports such as natural gas had risen much more than the price of the services the country mainly exports. .

‘That means – you don’t have to be much of an economist to realize that – what you buy has gone up a lot compared to what you sell. You’ll be worse off,” Mr Pill said.

A “pass-through game,” where everyone tries not to take the economic hit, can only add to that pressure, the bank official added.