The truth about UK living standards since the crisis Come next year's UK election, bread and butter issues of living standards will displace Europe and immigration from the top of the public debate. The problem is that there are so many different comparisons and data sources that many contradictory claims are true. Few will be both true and fair. Here, then, is a guide to British living standards since the crisis, which avoids cherry-picking data and the cop out of saying that results are all too uncertain and complicated to conclude anything. Consider first the past. With 2008 as a natural baseline, there is no doubt that the financial crisis hit households hard. Real wages or incomes - after adjusting for whatever inflation rate you choose - are significantly lower today. To give a sense of the scale of the drop in real pay, the Annual Survey of Hours and Earnings, published on Wednesday, shows median full-time gross weekly earnings down 8.8 per cent between 2008 and 2014 after adjusting for consumer price inflation. The biggest squeeze occurred in 2011, when households were hit by large rises in food and energy prices. For all the global concern about inequality, there is no need for British hand-wringing. Since 2008, the earnings distribution has been flat as a pancake. And because the coalition government has protected people dependent on social security more than the working population, inequality of net incomes has edged down. Apart from the huge squeeze in pay, the only other thing of note in the distribution is an unprecedented improvement for the old relative to the young. As Paul Gregg, Steve Machin and Mariña Fernández-Salgado have demonstrated, the fall in real wages for those aged 18 to 25 has been so extreme, they are now back to levels last seen in 1988. Older workers appear unconcerned by seeing more junior colleagues suffer. If past trends are clear, the present is statistically murky. There is again no sign of any increase in wage or income inequality and younger people are still bearing the brunt of squeezed incomes, but the degree of squeeze is very difficult to gauge. The latest ASHE shows simultaneously that overall real median pay fell 1.6 per cent in the year to April, but that pay for the continuously employed rose 2.3 per cent. First, pay gains for the continuously employed almost always exceed the raw median because the measure includes promotions but excludes retirement - but the gap is unusually large this year. So the second part of the explanation is that there has been a large change in the composition of the workforce with an increase in low wage employees, depressing the average. Although based on different data, the Resolution Foundation estimates that without this change in the composition, monthly wage figures would have shown real wage growth of 0.1 per cent in the first half of 2014 rather than a 0.8 per cent drop. Most recently, the data suggest monthly wages have been growing fast, but we do not know whether the pay squeeze is ending or whether we are seeing the composition effect unwinding. For the future, the Bank of England hopes for a resumption in real pay and real income growth. Its ambitions are predicated on Britain's productivity crisis abating, something the central bank has persistently forecast only to be disappointed by reality. There are again few signs of big shifts in income inequality. Rising real incomes of those in work would tend to increase the gap with those dependent on social security, but this effect will be offset by rising employment raising the incomes of those moving into work. So when it comes to the election, arguments about inequality are misplaced. It is the squeeze in almost everyone's incomes that matters. Here, the outlook is brightening but we are very much at the dawn of better times. If you are young, the night is still very dark indeed.