Toughest squeeze on living standards since 1920

Graham_Devon

I know it's a DM link, but this was discussed earlier on Radio2 and was listening to it in the office....just can't find a link from the BBC!

Seems living standards (however they are measured) are at the lowest since the 1920s, as the average person spendd 3 hours a week fretting over finances.

Before I go on, I know this isn't reletive to anything, but al the numbers are up against previous surveys.

Meanwhile, more people are being forced to take on debts to make ends meet.

'Many consumers are clinging to the edge of a financial cliff with savings at rock bottom and personal debt levels sky high.

'Shocking numbers of people say they are forced to take on new forms of debt just to make ends meet, and many more would not cope with unexpected shocks to their incomes or household bills.'

Those aged 18 to 29 have borne the brunt, suffering a fall in purchasing power of twice the national average of 0.9 per cent, according to the report.

Almost half in this age group run out of money every month.

They also have more debt than any other age group, owing 47p for every pound they earn, compared with the national average of 21p.

But those in the lowest bracket of income, £12,376 or lower, owe an average of 72p out of every pound they make.

Meanwhile, national figures suggest payments outstrip new debt. That's not to say people are actively overpaying debt as such....the figures suggest people are just taking less debt on on average.

It's not good out there. Especially for the younger generation.

http://www.dailymail.co.uk/news/article-2178012/We-spend-hours-week-fretting-cash-squeeze-budgets-mean-living-standards-lowest-1920s.html?ito=feeds-newsxml

ukcarper

As earnings have increased 3x more than RPI since 1920 you have to wonder about this report.

Graham_Devon

ukcarper wrote: »

As earnings have increased 3x more than RPI since 1920 you have to wonder about this report.

Why?

It's not earnings they are looking at.

The report states it's the toughest squeeze on finances since the 1920's. That means we haven't seen finances (regardless of the size of them) squeezed as much as they currently are since the 1920's.

The wages can be 100x higher, but if the demand on those wages is higher than it was in the 1920's, the squeeze will be tougher.

I'd also suggest RPI is a hopeless took to be measuring it against over that period of time.

dandy-candy

The problem is that in the 1920s many people lived hand to mouth. Nowadays you're classed as poor or deprived if you don't go on holiday every year, swimming every week or haven't got Sky tv. I think we would be really stuffed if people were as poor now as they were in the 1920's.

ukcarper

Graham_Devon wrote: »

Why?

It's not earnings they are looking at.

The report states it's the toughest squeeze on finances since the 1920's. That means we haven't seen finances (regardless of the size of them) squeezed as much as they currently are since the 1920's.

The wages can be 100x higher, but if the demand on those wages is higher than it was in the 1920's, the squeeze will be tougher.

I'd also suggest RPI is a hopeless took to be measuring it against over that period of time.

I suppose if we went back to all the family living in one room and only buying food our finances might not be stretched.

RPI is the only measure weve got unless you know the cost of food and
accommodation in 1920

Graham_Devon

dandy-candy wrote: »

The problem is that in the 1920s many people lived hand to mouth. Nowadays you're classed as poor or deprived if you don't go on holiday every year, swimming every week or haven't got Sky tv. I think we would be really stuffed if people were as poor now as they were in the 1920's.

It's not saying we are as poor.

It's stating that it's the toughest squeeze (or demand) on wages since 1920.

As poor as, and toughest squeeze are two different things.

Graham_Devon

ukcarper wrote: »

I suppose if we went back to all the family living in one room and only buying food our finances might not be stretched.

You are quite correct.

However, we have to deal with todays lifestyle, and look at that.

You can't suggest it's OK as 90 years they did X, Y and Z. Times have changed. Living standards have changed. The way we live has changed. Working patterns, how we work, where we work has changed.

And in any case, to carry out your point, people would be selling left right and centre to pool resources. That ultimately would end up in such dire financial consequences for so many families (houses would be worth less and less as people sold to pool resources, therefore seeing spiralling negatiove equity) that the point you are making would backfire on individuals spectacularly.

We have to look at now, and how finances and living arrangements are now, rather than trying to ignore the reports because of the points you make.

RPI is the only measure, but as I say, it's flawed. We pay for things now that didn't even exist in 1920. Council tax, road tax, NI. You can't measure the impacts of just those very few changes with RPI against when people didn't even know they existed, and paid something completely different, or didn't pay stuff such as road tax at all.

ukcarper

Graham_Devon wrote: »

You are quite correct.

However, we have to deal with todays lifestyle, and look at that.

You can't suggest it's OK as 90 years they did X, Y and Z. Times have changed. Living standards have changed. The way we live has changed. Working patterns, how we work, where we work has changed.

And in any case, to carry out your point, people would be selling left right and centre to pool resources. That ultimately would end up in such dire financial consequences for so many families (houses would be worth less and less as people sold to pool resources, therefore seeing spiralling negatiove equity) that the point you are making would backfire on individuals spectacularly.

We have to look at now, and how finances and living arrangements are now, rather than trying to ignore the reports because of the points you make.

RPI is the only measure, but as I say, it's flawed. We pay for things now that didn't even exist in 1920. Council tax, road tax, NI. You can't measure the impacts of just those very few changes with RPI against when people didn't even know they existed, and paid something completely different, or didn't pay stuff such as road tax at all.

As you say it’s a squeeze but you have to take into consideration from what level you are falling from i'd rather be faced with giving up sky or my TV than food.

Your last paragraph explains why this type of statistic is a waste of time.

They wouldn't have to sell up just take in a couple of lodgers.

PasturesNew

Food in the 1920s, for many, was mostly probably a big pot of stew. Most didn't have ovens - just an open grate; if you wanted to bake a loaf or a pie you'd make it then take it to the local bakehouse and pick it up later.

My mum was brought up by her grandparents (illegitimate, that's what they did in those days) and they lived on trapped rabbits and veg off the allotment. They didn't have an oven. They had a 2-up-2-down terraced, rented, house, which they rented for years/decades. There must have been 4-5 children + 2 illegitimate grandchildren in the house, looking at the family tree.

Graham_Devon

ukcarper wrote: »

They wouldn't have to sell up just take in a couple of lodgers.

Where do the couple of lodgers come from?

It's all removing demand.

ukcarper

you could probably make £200 to £400 a month by moving your kids in with you and letting out your spare room that should help you.