Regular pay fell at the sharpest rate on record between April and June, official figures out this morning show.
Wages - when taking into account rising prices - dropped by 3% on the year, the Office for National Statistics (ONS) said.
Household budgets are being hit by soaring energy bills as well as higher food and fuel costs.
The rise in prices has fuelled the UK inflation rate to a 40-year high and figures due out tomorrow are expected to show a further increase.
Darren Morgan, director of economic statistics at the ONS said the "real value" of pay was continuing to fall.
"Excluding bonuses, it is still dropping faster than at any time since comparable records began in 2001," he told the BBC.
The ONS said growth in regular pay, excluding bonuses, was 4.7% in April to June 2022. Excluding the pandemic, it is the fastest growth in 15 years. However, after taking into account inflation over the year, wages fell by a record 3%.
The data also also revealed that quarterly job vacancies fell for the first time since 2020.
Between May and July, they dropped by 19,800 to 1.274million.
However, the ONS points out that since vacancies fell to an all-time low between April and June 2020 in the early months of the Covid pandemic they have increased by 945,000.
FTSE 100
The UK's top share index, the FTSE 100, was up 24 points at 7,533 shortly after opening this morning, following yesterday's eight-point gain.
Brent crude futures were 1.20% lower at $93.94 a barrel - a long way from highs of more than $120 a barrel recorded in March after Russia’s invasion of Ukraine.
World oil prices settled lower on Monday after disappointing Chinese economic data renewed concerns of a global recession which could reduce fuel demand.
Brent crude futures finished down $3.05, or 3.1%, to $95.10 a barrel after dropping 1.5% on Friday.
US West Texas Intermediate crude was down $2.68, or 2.9%, at $89.41 after dropping 2.4% in the previous session.
Companies reporting today
- Half-year results: Genuit Group
- Trading update: Watches of Switzerland