A new survey into spending amongst Irish households shows further evidence of the difficulties facing the “squeezed middle”.
Almost 80 per cent of Irish households have cut back on some item of spending due to the recession, with one fifth missing or delaying paying bills, and 10 per cent borrowing money from family or friends in order to meet their outgoings.
According to a new survey from the Central Statistics Office (CSO), which polled consumer habits in the two years preceding the second quarter of 2011, spending on groceries and entertainment took the largest cuts, with more than half of households cutting their weekly shopping bills and expenditure on going out. Holidays abroad were also cut back by just under half of all households.
Savings have also taken a hit, with 45 per cent of households spending some or all of their savings and 62 per cent reducing the amount being saved during the period under review.
One fifth of households delayed or missed paying their bills in order to meet their everyday outgoings, while one in 10 delayed or missed loan repayments or their credit card bill.
Unsurprisingly, given the difficulties racing the retail sector, almost two thirds of households cut back spending on clothing and footwear. Club memberships, classes, health insurance and pension contributions have also been downsized, with 15 per cent dropping private health cover, for example.
Young couples with families have been hit the most, as those under the age of 55 were much more likely than their older counterparts to cut back on spending, with three quarters in this age category cutting back on clothing and footwear, compared with just half amongst the over 55s.
The survey also points to particular difficulties amongst the unemployed; with four out of every five households where the respondent was unemployed reporting that they had cut back their spending on groceries in the previous two years. Moreover, 30 per cent of these households had borrowed money from family or friends to pay for every-day items, while half of such households had missed paying household bills, and a quarter had missed loan repayments.
The next survey in this series from the CSO will focus on household financial distress and will be published in 2013.
