A group of 67 economists has written to Boris Johnson to warn him he is “fighting the wrong battle” by trying to keep wages down, and risks plunging the UK into recession as a result.
The prime minister last week warned of a 1970s-style “wage-price spiral” fuelling inflation if pay packets were to increase in line with soaring prices.
But the economists – including academics from Oxford, Cambridge and London universities – said that the opposite was true, with the economy in need of additional household spending power to maintain demand.
