The cost of living crisis is already here, but it’s far from over.
The cost-of-living crisis is going to impact a large number of people in the UK, but, according to a report from the Intergenerational Foundation , it’s the under-30s who will be hit the hardest, as they bear the brunt of Covid-19 and the health and social care alongside it. Those with student debts also face another cost as millions can expect higher bills on student loans next year after the government froze the thresholds at which repayments start.
In his Spring Statement, UK Finance Minister Rishi Sunak acknowledged that the Russia-Ukraine war was putting more pressure on the cost of living in Britain, with prices already on the rise due to supply chain issues in the wake of the pandemic. He cited an Office for Budget Responsibility forecast that inflation will average 7.4% this year.
To try and offer some relief from rising prices, the Finance Minister announced an immediate cut to fuel taxes of 5p per litre for 12 months, effective now. However, experts are sceptical about how much this will really help young people and families.
Here, one woman explained how the rising costs will disproportionately impact single women and mothers.
“I feel a bit trapped, to be honest,” said Carly Allen, 36. She has a three-year-old son, Ezra, with whom she lives in a two-bedroom flat in London. Despite working 28 hours a week for a charity and a second job in the evening, money is already tight. As a single parent raising her son alone, Carly is worried about how the current cost of living crisis will impact her.
The cost of living in the UK is becoming increasingly worrying. The price cap for energy bills is set to jump significantly in the following months, when council tax will also go up. This will compound the already soaring grocery and transport costs, tax hikes and rent prices, which have increased nearly tenfold outside London while wages mostly remain stagnant.
Single people and people who live alone will be some of the hardest hit by the crisis. According to ONS data from 2019, people living on their own spend an average of 9% more of their disposable income than two-adult households, mainly on the same bills that are set to go up.
As Carly doesn’t co-parent, and both of her parents work full time, she’s forced to work reduced hours at her job while forking out more than £2,000 on nursery fees and rent each month. She then has to factor in her fully electric heating, which, she said, ‘is very unideal, especially in this crisis’.
She added: ”Even before the cost of living crisis, my bills have consistently been way too expensive and unaffordable. Now, there’s additional pressure on top of that with council tax and energy bills rising.”
Single parents will face the brunt of the looming crisis. Victoria Benson, Chief Executive of Gingerbread, the charity for single-parent families, said: “Being a single parent means you only have one household income and it has to cover lots of fixed costs that couples can share, such as housing and heating, both of which take up big chunks of anyone’s budget.
“Once childcare and other essentials are paid for, there’s not much money left, which means single-parent families often experience poverty or live with problem debt.”
Losing the £20 Universal Credit increase and an £80 stipend for working from home has left Carly under even more financial strain. This means that her disposable income is minimal after paying off debt and putting a little aside for savings.
Carly said: “I feel like it’s inevitable that I will go into debt. When I run out of money towards the end of the month, I rely on my credit cards, especially for big expenditures like the food shop and bills – and I feel like I’m starting to run out earlier and earlier.”
Understandably, the uncertainty is impacting Carly’s mental health.
“I feel powerless. It’s the anxiety of not knowing how the increasing costs will impact me,” she said. “I don’t have the potential to do much else. I’m just trying to balance everything while prioritising Ezra and me, and the juggle of it all is exhausting.”
According to an analysis by the Joseph Rowntree Foundation, low-income individuals who live alone will spend the most on gas and electricity bills (33% of their income after housing costs).
Single women, in particular, will feel the consequences. As on average women earn less than men, single women are more likely to struggle to cover the cost of living on a single salary. A recent Women’s Budget Group (WBG) research has found that no region in England is affordable for women renting independently, whereas men on an average salary can afford every region except London.
Olivia Bailey, 28, lives in a shared house in Manchester. After recently getting a full-time job, she was excited to finally move out and get a place on her own, but the rising cost of living means she’ll have to hold off.
She said: “I was really looking forward to moving to my own flat this year but, because of rising housing and energy costs, a flat will cost me more than half of my salary.
”It looks like I’ll be stuck in shared accommodation until I can find someone to share a flat and bills with. I’m getting really stressed and anxious because I don’t feel safe in my home anymore (due to problems with a housemate).”
The cost of living crisis is already here, but it’s far from over. As bills continue to rise and wages stay stagnant, it’s important to remember that not everybody is in the same boat – and it will be much harder for some to stay afloat.
“The cost of living crisis is hitting people now, and it is hitting the lower-income families and individuals the hardest, as they are the ones with fewer savings to rely on, and women are more likely to be in those positions, with low incomes and less savings,” said Dr Sara Reis, deputy director of WBG.
“The government should target support to people on low incomes, and the best way to do this quickly and swiftly is through our social security system, which was designed precisely for that purpose.
“In the medium to longer-term, there needs to be a concerted effort to close the gender pay gap to ensure that women’s hours of work are not underpaid compared to their male peers. And an investment in social infrastructure like childcare is crucial to ensure that single mothers, in particular, can earn a living and support their children to the best life-start possible.”
As Carly said: “Something’s got to give.”
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