HOUSEHOLDS in the north have experienced a record drop in their spending, according to new research.
The UK’s Centre for Economics and Business Research (Cebr) found the spending power of the average family in Northern Ireland had contracted by 28.7 per cent in a year.
The data, produced for Asda’s latest income tracker for the third quarter (Q3) of 2022, suggests the average family here was left with only £95.10 per week to spend on discretionary goods and services.
That represented a £38.30 drop year-on-year, leaving the north as the worst off region of the UK, with the gap continuing to widen with the rest of the UK, where the average stood at £209 per week in Q3.
The research comes as the UK’s Office for National Statistics (ONS) published new experimental data on Tuesday, exposing the impact of inflation on the lowest priced groceries in supermarkets.
It found that the price of vegetable oil jumped by 46 per cent in the past five months, with lower priced chips (24 per cent) and bread (22 per cent) also seeing sharp rises in recent months.
The study, which analysed 30 everyday low price groceries between April 2021 and September 2022, found the average price jumped by 17 per cent.
Important data highlighting the impact of food inflation on lower price/own brand supermarket products, and in turn how inflation is impacting those in the lowest/lower income brackets. https://t.co/WywEUVRPJ1
— Ryan McAleer (@RyanMcAleerbiz) October 25, 2022
Speaking at a stakeholder breakfast event in Belfast, Cebr senior economist Sam Miley said: “This month’s figures showed that spending power in Northern Ireland is dropping at a record level, as the cost-of-living crisis eats into household budgets.
“Accelerating inflation has impacted the Income Tracker and we are projecting this to peak in Q4, damaging spending power further and contributing to recessionary pressure across the UK.
“Northern Irish households have been particularly impacted by inflation, with their spending being more heavily concentrated in high inflation categories such as food, energy, and motor fuels.
“Northern Ireland’s spending power is also being affected by weaker income growth. This is explained by the country’s labour market composition, seeing a weaker employment rate, a higher inactivity rate, a greater share of employees earning below the living wage, and a larger share of employment in the public sector which has now seen pay growth outstripped by the public sector for 17 consecutive months.”
In a separate survey, the ONS found disabled people are more likely to have difficulty affording their energy bills, mortgage or rent and to fall behind on payment.
More than half (55 per cent of disabled people said they were struggling to afford their energy bills during the period June 22 to September 11.
That compared with 40 per cent of non-disabled adults.
The same survey found adults who were renting their home were more likely than those paying a mortgage to find it difficult to afford their energy, rent or mortgage payments.
Some 60 per cent of renters reported finding it difficult to afford their energy bills, compared with 43 per cent of those with a mortgage,
The ONS said the differences observed between renters and people paying mortgages is likely due to some of the latter being on fixed rates, whereas renters "may be more exposed to increases".
