Theresa May has attacked the Scottish National Party for "failing the people of Scotland" as the party's Westminster leader condemned the UK's record on earnings.
Ian Blackford told the British Prime Minister that real wages in Britain have fallen by 2.6% since 2007, and said the Government could find the money for quantitative easing but not for fiscal measures to grow the economy.
He said the British Government did not "understand how to use economic levers", but Mrs May told Mr Blackford the Scottish economy and the livelihoods are "better off in the United Kingdom".
Following a question from Mr Blackford on the real wage growth in the OECD, Mrs May said: "He should look at what is happening to the economy in Scotland under an SNP government, because it is an SNP government that is failing the people of Scotland.
"And the only thing I will say to him is that the people of Scotland now have a strong voice in this House through our 13 Conservative Members of Parliament."
Mr Blackford went on to ask: "The UK's record on earnings has been significantly worse than almost every other developed country. In fact, real wages in the UK have fallen by 2.6% since 2007.
"Wages aren't growing, the cost of living is rising, household budgets are stretched.
"The Government can find the money for quantitative easing - £435 billion since 2009 - but can't find the money for fiscal measures to grow the economy."
As he urged Mrs May to take "responsibility for the Government's gross mismanagement of the UK economy", he said: "This is a Government that does not understand how to use economic levers and it's our people that are paying the price."
Mrs May said Mr Blackford failed to mention the "increase in employment that has taken place across the United Kingdom and what the figures show today".
"But he also he started off by standing up and complaining that I'd referenced the acts of the Scottish government - he believes in independence, he believes that Scotland should only be run by the Scottish government - so I think the Scottish people deserve to look at and in this House we deserve to talk about what the Scottish Government is or is not doing for the people of Scotland.
"The one thing I can tell him and others is that the Scottish economy and the livelihoods of the people of Scotland are better off in the United Kingdom."
Jeremy Corbyn has accused Tory MPs of telling each other "we've never had it so good" as he attacked the Government's record on the economy.
The Labour leader also said pay rises for police and prison officers announced this week did not go far enough and would have to be paid for by cuts in other budgets.
Theresa May said the Tories were overseeing sound management of the economy, which Labour would destroy if it got into government.
Mr Corbyn's attack came after reports of comments made by British Chancellor Philip Hammond at the Conservatives 1922 Committee of backbench MPs.
"He told Conservative MPs 'look at us - no mortgage, everybody with a pension, never had more money in the current account'," said Mr Corbyn
"A Conservative prime minister once told Britain 'you've never had it so good'.
"Now Tory MPs tell each 'we've never had it so good'.
"Can the Prime Minister tell us what's happened in the last seven years to the average person's bank account?"
The Prime Minister pointed to the latest figures showing record levels of employment, criticising Mr Corbyn for failing to acknowledge the figures in his questioning.
She added: "Let's look at what has happened in our economy, what do we see?
"Record levels of direct investment in the British economy, firms investing in this country because they believe in the future of this country.
"What we also see from the employment figures today, more people in work than ever before, we see more women in work, we see more 16 to 24-year-olds in work or in full-time education than we've seen before.
"That's what you get with a strong economy, and what do we know, and what do the people know?
"That the Labour Party, with its high debt, its high taxes and its fewer jobs, the Labour Party would only destroy our economy as they did last time."
Earlier this week Downing Street said the seven-year public sector pay cap is to be scrapped, unveiling a 1.7% hike for prison officers and improvements totalling 2% in police pay for 2017/18.
But Mr Corbyn said that with inflation running at 2.9%, even these pay rises amounted to a pay cut in real terms.
He added: "Anything less means that dedicated public servants are worse off again and they've been made worse off every year for the past seven years.
"Yesterday the Prison Officers' Association weren't impressed either with the 1.7% offer, saying it's a pay cut, it's not acceptable.
"We discovered that they are being offered, the police as well, a slightly smaller real terms cut in their incomes, came the news that this would be funded by more service cuts.
"Can the Prime Minister guarantee no more police or prison officers will be lost as a result of the decisions she's made this week?"
Mrs May said public sector review bodies were independent, and that Mr Corbyn had failed to take account of automatic pay increases for many in the public sector.
She added that public sector pay had to be fair for taxpayers as well as the workers.
Mr Corbyn also challenged Mrs May to back a Labour opposition day debate opposing a rise in tuition fees, which will be debated in the Commons later.
The Prime Minister said: "He talks about delivering for students, let's talk about delivery, let's talk about promises that are made.
"He promised workers that he'd protect their rights, and on Monday he let them down.
"He promised students that he would deal with their debt, and he's let them down.
"He promised the British people that he would support Trident, and he's let them down.
"And he promised voters he'd deliver on Brexit, and he's let them down.
"What people know is that it's only the Conservatives that deliver a better Britain."