Workers must demand their pay rises by 8.7pc just to keep up with spiralling inflation and upcoming tax increases, after prices grew at their fastest rate in three decades.

The consumer prices index climbed to 5.4pc last month, figures released today have shown. 

There is further pain ahead as workers are hit with fresh waves of tax rises. From April, National Insurance rates will rise by 1.25 percentage points, further eating into wages. Meanwhile more workers will be dragged into higher tax brackets as personal tax thresholds remain frozen. 

A worker on a salary of £50,000 would need a pay rise of around 8.7pc in order for their take home pay to maintain its purchasing power from April.

Telegraph Money analysis shows that, after tax, from April a worker earning £50,000 will take home £37,198 after taxes are deducted. This is £464 less than their take-home pay in the current tax year. 

The effect of inflation and higher taxes would mean workers need a pre-tax salary of £54,350 from April to enjoy the same take-home pay as they do today. Achieving this would effectively mean earning a 8.7pc pay rise.

However, there are warnings that workers face an uphill battle to negotiate salary increases from their employers. While pay rise budgets for British firms have grown by a third this year, according to insurance firm WTW, this is yet to translate into inflation-beating wage growth.