Partner Article

Disposable income hits 9 year low

During the first three months of the year individuals had less disposable income to spend than at any other point since 2003.

According to the Office of National Statistics, disposable income, taking inflation into account, fell by 1% on the previous period.

Figures also indicate that real household income per capita, before tax and services provided by the state fell by 0.6% in Q1 in comparison with the previous quarter, the lowest level since Q2 2005.

Income from pay have weakened over the period alongside an increase in prices, resulting in the erosion of household incomes.

In a report on the economic position of households, the ONS said: “Finally, sustained population growth led to incomes being spread across a greater number of people, and therefore further reduced the growth of actual income per head.”

On average people have a weekly disposable income of £273 each week, while most recent figures also show that families are continuing to cut their spending and saving levels.

Actual expenditure fell in the first quarter to the second lowest level since Q3 of 2003. Despite this decline, householders are taking a safety-first approach, meaning that many are focussing on paying off their debts.

This was posted in Bdaily's Members' News section by Ruth Mitchell .