Cost-of-living crisis spreads to three quarters of us
In the first half of February, 76% of people said their cost of living had risen in the previous month – up from 69% in the second half of January. The most common price rise they mentioned was the increasing price of the supermarket shop (90%). This was followed by rising energy bills (77%) and the soaring price of fuel (69%).
The ONS has released its fortnightly data on economic activity: Economic activity and social change in the UK, real-time indicators – Office for National Statistics (ons.gov.uk)
Sarah Coles, senior personal finance analyst, Hargreaves Lansdown, said: “The cost-of-living crisis is squeezing more than three quarters of us. For those whose finances were already stretched to breaking point, this could signal the moment it becomes impossible to make ends meet. And even people who’ve previously felt reasonably financially comfortable are starting to feel the pinch.
“The price of food is actually increasing slightly slower than other runaway price rises, but it hits harder. Right now, prices are up 4.3% in a year, but they’re rising particularly quickly on staples like pasta, eggs and milk – all of which are up 8% or more. While there are other things we can cut back on or avoid spending on completely, we still need these staples. So once we’ve traded down brands or gone to a cheaper supermarket, there’s very little we can do to cut the cost.
“The rising price of energy is already hitting more than three quarters of us, but this is just the start of it. So far those who have come to the end of a cheap deal and those who have been switched from a failed supplier to a standard tariff with a new supplier are feeling the pain, but when the price cap rises by an eye-watering 54% in April, it’s going to bring financial agony for millions more.
“For those who are feeling the pinch for the first time, there are energy efficient steps they can take to bring down the cost. However, those who have been cutting their costs for months, have already done everything they can, so it’s essential to check whether there is any more help available from suppliers or the state. This system isn’t always easy to navigate alone, but Citizens Advice help people with this every hour of every day, so they can guide you through everything you need to know.
“The price of fuel at the pumps, meanwhile, hit new highs last weekend, and while the cost has dropped back since, disruption to the wholesale market means they’re unlikely to fall far in the immediate future. The cost of filling up is hitting even more people at the moment, as more workplaces are encouraging them to return to the office. For those who are trying to make space in their budget for the cost of the commute for the first time in a while, soaring fuel prices make this incredibly difficult.”