Britain’s household debt mountain has reached a new peak, with UK homes now owing an average of £15,385 to credit card firms, banks and other lenders, according to the TUC.

The trade union body said household debt rose sharply in 2018 as years of austerity and wage stagnation forced households to increase their borrowing.

The TUC said in its annual report on the nation’s finances that the amounts owed by British households rose to a combined £428bn in the third quarter of 2018. Each household owed £886 more than it did 12 months previously, it said. The figures do not include outstanding mortgage debts but do include student loans.

The level of unsecured debt as a share of household income is now 30.4%, the highest level it has ever been at. It is well above the £286bn peak in 2008 before the financial crisis, the TUC said. That figure also included student loans, but tuition fees then were £3,000 a year compared with up to £9,250 now.

Public spending cuts and years of wage stagnation are key reasons for the increase in unsecured debt, the TUC said, adding that working families are on average worse off today than before the financial crisis. The rise of the gig economy and zero-hours contracts are also thought to be a significant contributing factor.

The TUC general secretary, Frances O’Grady, said: “Household debt is at crisis level. Years of austerity and wage stagnation has pushed millions of families deep into the red. The government is skating on thin ice by relying on household debt to drive growth. A strong economy needs people spending wages, not credit cards and loans.”

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O’Grady said the minimum wage, at £7.83 an hour for over-25s, remained too low and should be raised to £10 “as quickly as possible”. She also said too few workers had the power to bargain for higher wages, and trade unions must be given the freedom to enter all workplaces and organise collective wage bargaining.

To compile its figures, the TUC compared the total amount lent in bank overdrafts, personal loans, store cards, payday loans and outstanding credit card debts. It also included student loans, which added a substantial amount to the figures. Graduates can now expect to leave degree courses with debts of £50,000, but are not required to make student loan repayments if they are not earning at least £21,000 a year.

Its data shows that in 1998, households faced average unsecured debts of £5,456. A decade later, just as the financial crisis was starting, that sum had doubled to £11,146. Since 2008 households have been struggling with flat or falling incomes, at a time when prices have risen fast.

In October, the Bank of England’s chief economist, Andy Haldane, said the rise of insecure work in the gig economy had fuelled a “lost decade” of wage growth in Britain.

In the same month, the Office for National Statistics said the acceleration in wages growth seen in the middle of 2018 still left real pay £11 a week lower than it was before the financial crisis erupted. On a positive note it also reported that British pay was finally starting to rise faster than prices – at 3.1%.

The TUC’s £15,385 debt figure does not include further debts incurred over Christmas, which would be expected to push the figure even higher, according to research published on Monday.

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The research found that workers expected to start the year with an average of £252 debt left over from the festive period alone. Shift and gig workers were hit hardest, putting £352 of festive spending on credit, according to the mobile app company Wagestream. Workers told researchers they feared they would not be able to pay off Christmas debts until May.

Becky O’Connor, a personal finance specialist at life insurer Royal London, said: “Paying off debt of this size can feel like a losing battle when there is no hope of an income rise on the horizon. It will be scant comfort that millions of other households are in the same boat. But there are actions people can take to reduce the burden. Those in real difficulty should seek specialist help from a free debt charity, such as StepChange.”