WORKERS’ living standards are still falling despite a slowdown in inflation, official figures showed yesterday.

The consumer prices index rose by 1.5 per cent in the year to May, compared with 1.8 per cent in the previous month. But earnings only rose by 0.7 per cent.

The traditional inflationary measure the retail prices index — which the government has sidelined — rose by 2.4 per cent, compared with 2.5 per cent in April.

House prices soared even further out of reach for many working-class people, rising 9.9 per cent over the 12 months to April.

Leading left economist Andrew Fisher said the drop in inflation would be “cold comfort” for workers and benefit claimants who were not seeing increases above 1 per cent.

Mr Fisher added: “The cost of living crisis is far from over, with the average worker 12 per cent worse off than a decade ago.

“We’re certainly not all in it together. In those same ten years, executive pay has risen by 74 per cent.

“It is no wonder that unions are gearing up for co-ordinated strike action over pay. 

“There will be no sustainable recovery unless people’s incomes improve markedly.”

Labour shadow minister Catherine McKinnell said: “The fall in the rate of inflation is welcome, yet most people are still feeling the squeeze.”

“Wages after inflation have now fallen by over £1,600 a year under David Cameron and the link between the wealth of the nation and family finances is broken.”