Britain has slipped two places to sixth in a European "standard of living" rankings, according to new research.
Eurostat and the Office for National Statistics (ONS) measured the "Actual Individual Consumption" (AIC), the level of goods and services that households consumed, for each EU country.
They found although Britain had slipped in the rankings, it's AIC was 18 per cent higher than the EU average.
Separate research by Legal & General found on average families have £1,094 in savings
Luxembourg topped the table followed by Norway, Switzerland, Germany and Austria.
TUC General Secretary Brendan Barber said in a statement: “Today’s plummet down the European living standards league table will come as no surprise to the millions of ordinary families struggling to make ends meet across austerity Britain.
“With wages failing to keep pace with rising prices, and many households soon to take an additional hit as tax credits and benefits are either frozen or taken away, people are understandably being careful with what little money they have and are reining in their spending.
“Families are having to watch every penny so high street spending is down and that’s hitting shops and businesses. We need people to spend and businesses to invest and so expand – only then will the economy get back to growth."
The possibility of a double-dip recession, government austerity measures, high inflation, and the continuing Eurozone crisis are all contributing to harsh financial times for UK households.
Barber added: "For all the Chancellor’s talk of a ‘global race’, when it comes to living standards the UK is falling further behind. Instead of making families bear the brunt of its ill-thought out economic policies, the government should concentrate on boosting consumer and business confidence by putting jobs and growth first."