The discretionary purchasing power of the average family in Northern Ireland has fallen below £100 for the first time since 2017.
The latest sda Income Tracker report points to discretionary income for local families of £93.50 per week in the second quarter of 2022, down 32% or nearly £45 per week less than in the same period last year. and £110 below the UK average. 204.
According to a report compiled independently by Cebr, New York State has experienced the biggest decline in purchasing power of any region in the UK and the biggest drop in Income Tracker’s history.
The latest NI data reflects the general trend in the UK, with household disposable income falling by 18% for the eighth consecutive month in June compared to the same period last year.
The skyrocketing cost of living, up 11% year-on-year in June, meant that British families were living worse on average by £43.95 a week, or £188.34 a month, compared to June 2021.
As the worst-performing region in the UK, this means the average New Zealand family has just £93.50 a week at their disposal after all taxes, necessities and bills have been paid; £33.50 less than in the first quarter of 2022.
Cebr attributed the sharp decline to income growth well outpacing inflation, with Northern Ireland also suffering disproportionately from a high share of public sector workers facing wage lags and a larger share of Social Security applicants suffering from the reversal of universal credit increases . .
When it comes to comparing purchasing power, the North East is the closest region to the NI with £123 a week in the second quarter, in stark contrast to Wales at £164 and Scotland at £205, while families living in London, have £249.88 a week on their homes. Retirement – London’s discretionary income fell below £250 for the first time since Q4 2018.
At a UK-wide level, the cost of living crisis has hit low-income families particularly hard, as the poorest 20% of UK households all have ‘negative disposable income’, leading to a £60 a week deficit in June. between what they earned and what they needed to spend on necessities like mortgages, rent, utility bills, and travel expenses. Increasingly, those in the bottom 40% of households also earn negative discretionary income.
Asda continues to take a number of steps to support customers and colleagues during the cost of living crisis, including the launch of the new Essential Living Hub, an online space where customers can access a wide range of tips, tricks and life hacks to go beyond the weekly grocery store by talking about how to save energy, optimize your budget, shop and cook smart, entertain the kids for free, and even eat out without paying a dime.
For shoppers, Asda has also extended a £1 children’s cafe meal to the end of the year with no minimum cost for adults and has ‘dropped and locked in’ prices on more than 100 family favorites through the end of the year. On average, prices will decrease by 12%.
“The latest Income Tracker report shows sharp results for Northern Ireland, with the country’s median household income at just £93.50 a week in the second quarter,” said Sam Miley, senior economist at Cebr.
“The consequences of the cost-of-living crisis are clear: rising prices reduce incomes and reduce the ability of families to spend money. Indeed, in the second quarter, for the first time in five years, households in Northern Ireland had less than £100 a week for basic necessities.
“The worst could be yet to come as an even bigger spike in inflation is forecast for the fourth quarter, driven by food and transportation prices. This will further reduce purchasing power.”
* The Asda Income Tracker is a ‘discretionary income’ measure of the amount left after the average British family deducted taxes from their income and bought essentials such as: groceries, electricity, gas, transport costs and mortgage interest payments or rent. Income Tracker measures the amount that can be spent on discretionary purchases such as leisure and entertainment goods and services.