By Jonathan Davies

UK workers will see the first real-term wage rise since 2007 this year, according to economy forecaster EY Item Club.

Real-term wages, which subtract the effect of inflation, will rise by 1.8% in 2015 EY said, before "further steady rises thereafter".

Inflation has been growing faster than wages for a number of years, causing a cost of living crisis for a lot of people. But low inflation towards the end of 2014 and at the start of 2015 has seen wages start to rise quicker.

EY said that on average, UK wages have fallen by 8% since 2008. It is the biggest fall over an equivalent time period since records began in the mid 19th century.

The Bank of England has warned that inflation could turn negative in the Spring. Inflation fell to the record low of 0.3% in January.

EY also forecast unemployment would fall to its pre-crisis levels of 5%, from 5.7% now.