NI consumers hardest hit in UK as discretionary income falls 13%

Discretionary spending power of the average Northern Ireland family dropped to £127 per week in the first quarter of 2022, almost £20 per week (13.3%) less than the same period a year ago and £108 below the UK average of £235.

sda’s latest Income Tracker report for March 2022, independently compiled by Cebr, indicates Northern Ireland is facing the largest contraction in spending power of any region across the UK.

For the UK as a whole, an annual contraction of 6.5% in March resulted in families having £16.19 less in weekly discretionary income compared to the same period last year; the largest fall in the history of Income Tracker. Discretionary spending is defined as available income once all taxes, essential items and bills have been paid.

NI has a larger share of public sector workers, a sector which has suffered from lagging wage growth in recent months.

The withdrawal of the Universal Credit uplift (Oct 21) has been a further factor, given NI’s high level of claimants, says Cebr, with household living standards here under the most pressure in the UK as a result of the ongoing cost-of-living crisis.

Region-wise, the North East of England is the closest region to NI at £152 per week, against Wales at £198, Scotland at £236 and London, with the latter the only region posting no change on the previous quarter.

Lowest income families had 74% less disposable income this March compared to a year ago, driven by commodity market pressures, rising inflation and spiraling utility costs.

“The latest Income Tracker report highlights the financial strain being placed on households amidst the ongoing cost-of-living crisis,” said Sam Miley, senior economist at Cebr.

“Though spending power is down almost across the board, those in Northern Ireland have been particularly impacted, with inflation spiraling and wage growth overall falling behind. These trends are set to continue over the coming months, meaning households could find themselves in an even more precarious position.”

Asda has announced a series of measures to support UK households, ‘dropping and locking’ the price of over 100 family staples until the end of 2022 and making a multi-million-pound investment in its new Just Essentials at Asda value-focused range.

It has also increased its rate of pay to £10.10 per hour from July 2022 for 120,000 shop floor workers.

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