From today, around a million workers will benefit from a rise in the minimum wage. Their earnings won't go up by much – a rise of 11p per hour is actually a pay cut in real terms. And as for young people working for the minimum wage, those that have jobs at all, they aren't likely to get any pay rise at all.

The small increase in the minimum wage is symptomatic of what's happening to wages across the economy. For the last three years, wages have been falling in real terms, as the cost of living outstrips paltry pay rises. TUC research out this week estimates that the average worker on £26,000 is around £1,500 poorer than they were three years ago.

Listening to government ministers you'd think it was the old foes of red tape and bloated public services that were holding the economy back. But neither of these were much of a brake in the decades running up to the financial crash.

A far better way to assess the poor health of the economy is to look at consumer spending – the main driver of economic growth in the UK. Here, falling wages, tax rises and cuts to tax credits are making people poorer. We are all spending less money as the country is gripped in the tightest squeeze on living standards since the 1920s.

The origins of this income squeeze go back far longer than the financial crash. The proportion of economic gains going on wages has been falling for 30 years. Over the last few decades this was covered up by strong employment growth, new support such as tax credits and rising personal debt. This support is unlikely to continue into the next decade.

Of course some have been immune to this squeeze. The pay of those at the top soared away during the boom and has failed to come back down to Earth after the crash.

Now that we're all feeling the effects of a failed executive pay culture based on short-termism and stock market bubbles, we need to re-examine the way we set pay from the bottom to the very top of business.

The twin track of wage growth since the turn of the century is illustrated by a statistic calculated by One Society, which found that if the minimum wage had increased at the same rate as the pay of FTSE 100 directors since its introduction in 1999, it would now be almost £19 an hour, rather than its current rate of £6.19.

This tells us just how out of control pay at the top is and how hard life is for those struggling along at the bottom.

We will hear lots of plans for growth during the party conference season. But the issue that the TUC – and the vast majority of ordinary working people, I suspect – want to hear more about from all parties is pay.

Wages are fundamental to our economic recovery. We need decent pay to lift people out of poverty, helped by a higher minimum wage and a more widespread living wage. We need a better chance of a comfortable income for those in the middle, helped by encouraging more skilled jobs in growing industries. We need fairer wages for those in the boardroom, with employees having a seat on remuneration boards and packages that run in line with the long-term health of a company and not its short-term share price. And, of course, we need strong unions and more collective bargaining. That is the best way to ensure that all workers get the level of pay they deserve and that employers can afford, and so build a stronger and fairer economy for the future.