By Jonathan Davies
The average household income in the UK is back to pre-crisis levels, according to the Institute of Fiscal Studies (IFS), but still lag behind the 2009-10 peak.
The think tank also found that the average incomes for working age people were still below pre-crisis levels, when accounting the impact of inflation. Over 60s are set to have higher incomes this year than in 2007-08.
The IFS found that living standards had risen more slowly than after previous recessions, largely due to weak growth in salaries and income. But it added that government tax increases and benefit cuts had reduced average household income.
"The young have done much worse than the old, those on higher incomes somewhat worse than those on lower incomes, and those with children better than those without," said IFS research economist and report author Andrew Hood.
The IFS research found that the median household income grew by just 1.8% between 2011-12 and 2014-15. And the younger workforce is being hit particularly hard, with 22-30 year olds' income 7.6% below pre-crisis levels.
Robert Joyce, IFS senior research economist, said: "The key reason living standards have recovered so slowly has been weak earnings growth. In the long run, policies that boost productivity, and so increase real earnings, are likely to have a bigger impact on living standards than changes in tax and benefit rates."
A Treasury spokeswoman said household incomes "are now restored to around their pre-crisis levels and are expected to grow well above inflation this year".
"At this rate of progress, real terms median household incomes would be higher in 2015-16 than they were in 2010-11."
But IFS director Paul Johnson, was less than enthusiastic about the findings: "It's astonishing actually that seven years later incomes are still no higher than they were pre-recession and indeed for working-age households they're still a bit below where they were pre-recession."