Economic climate (Aug 2009)

TNS Omnibus survey to a representative sample of 2055 GB adults aged 16-64, conducted online 30th July – 6th August 2009.   Commentary is based upon the total sample and then the London region compared to the whole survey results. Click here for the full data tables.  

Spending  

• Just under three-quarters of Brits (73%) say they have cut down on spending in the last 12 months.
  
  • More women than men have cut back (76% against 70%) – perhaps symptomatic of being responsible for general household spend.
  • The 16-24’s are the age group least likely to have cut back – at 62% they are 11 percentage points lower than the national statistic and 16 percentage points lower than the 35-44’s, who at 78% are most likely to have cut back.    
• London is the region least likely to have cut down at 69% - the highest area is the North East/Yorkshire Humberside region at 78%. 
   
• Of those who say they have cut down on spending, the Top 10 areas cut back on significantly in the past 12 months are shown below.  
  
  1. Social activities 74%
  2. Non essential clothes/shoes 73%
  3. Premium groceries 65%
  4. Holidays 59%
  5. Electronic leisure 54%
  6. Electronic items 45%
  7. Toiletries, Health and Beauty 36%
  8. Charity donations 32%
  9. Car travel 30%
  10. Gas/Electric/Utilities 25%
• Of those Londoners who say they have cut down on spending, the Top 10 areas are shown below.
  • Gym membership could be higher per se in the London area than the rest of the country, so the rise in the placement compared to the national picture (position 7 at 35% against position 11 at 24% respectively) may be attributable to a greater proportion in London having opportunity to cut back on this area of spend.
  • Just outside of the London Top 10 at number 11, Public Transport achieves 23% and is 7 percentage points higher than the national statistic of 16%. Possibly more Londoners are walking and cycling to get around and/or just not getting out and about on Public Transport anyway – which seems to be borne out by the drop in spend on social activities.  
    
    1. Social activities 75%
    2. Non essential clothes/shoes 72%
    3. Premium groceries 66%
    4. Holidays 65%
    5. Electronic leisure 47%
    6. Electronic items 46%
    7. Gym membership 35%
    8. Toiletries, Health and Beauty 32%
    9. Charity donations 32%
    10. Car travel 32% 

Holidays  

• 37% of the total sample have taken more holidays in the UK since this last time last year instead of going abroad to save money.
  • Those with children aged under 16 are more likely than those without to have swapped UK for abroad (43% and 34% respectively).
  • The 25-34’s are the age group most likely to have made the swap at 45%.
• Londoners show no real difference from the overall national picture with 36% choosing UK over destinations abroad to save money.
    
• Nationally, 33% say they will take more UK based holidays rather than go abroad to save money in next 12 months.
  • Again those with children under 16 are more likely at 39% than those without (28%).
  • This time it is the 35-44’s at 38% as the age group most likely to trade UK for abroad.
• Again, Londoners show no real difference from the total sample with 31% saying they will choose the UK rather than abroad in the next 12 months to save money.  

Job and Financial Security  

• Overall, a third (33%) of those in full or part-time employment in our survey are fearful of losing their job in the next few months. 8% say they are very fearful.  
• London workers appear to be slightly more anxious with 37% expressing some degree of fear about redundancy – the highest across all regions (Scotland being the lowest at 27%). 10% of Londoners are very fearful – 2 percentage points higher than the national finding – although all differences are not statistically significant.
   
• If they were made redundant, 15% of British workers say they couldn’t meet their financial commitments with immediate effect. 17% could last less than a month before finding another job. 25% could last up to 3 months.
  
  • In total, 63% of workers claim they could last a year.
  • Across the age groups, those most likely to be able to last up to a year are the 25-34’s at 68% whilst the 55-64’s are the most likely to be able to last for more than 2 years (16% compared to total sample figure of 7%).
  • Scotland and the North West regions are the most uncertain about just how long they could last; 14% in each region couldn’t select an answer and put themselves into the ‘Don’t know’ category.  
• Working Londoners seem to be able to stay the distance a little longer; 12% would not be able to meet financial commitments with immediate effect. 21% could last less than a month and 69% of London workers could last up to year, which is the highest level recorded across the regions for this time period (lowest is North East/Yorkshire Humberside area at 58%). Londoners appear to have a better fix on their financial situation with regard to life post redundancy; of all the regions they scored the lowest ‘Don’t know’ score at 5%.  

Bank of England Interest Rate Expectation  

• 29% think the Bank of England will start increasing the base interest rate in the next 6-12 months, which would be at some point before August 2010;
  
  • 23% think it would be earlier than this, sometime in the next 3-6 months.
  • An optimistic 12% think it would be in the next 3 months.
  • A pessimistic 17% think it would not be until over a year’s time.
  • 18% were unable to give even their best estimate.
     
• Londoners are not really not so different in their views; 32% think the Bank of England will start increasing the base interest rate in the next 6-12 months,
  
  • 23% think it would be sometime in the next 3-6 months.
  • 15% think it would be in the next 3 months.
  • 15% think it would not be until over a year’s time.
  • 19% were unable to give even their best estimate  

Higher Taxes OR Spending Cuts?  

• The question posed was; If you had to choose, would you rather pay higher taxes OR see spending cut on the front line public services. A ‘Don’t know’ category was included.
• This split the sample fairly evenly with their three choice options; 36% went for paying higher taxes 35% for cutting front line spending and 30% were simply unable to make a choice one way or the other, reflecting the fact that this is not really a black and white decision in many people’s minds.
  
  • Men are significantly more likely than women to want spending cut on front line public services (42% against 27% respectively). They also felt able to make a choice as significantly fewer – 15 percentage points – selected the ‘Don’t Know’ option (22% men against 37% women).
  • The oldest age group in our sample, 55-64’s, are most in favour of higher taxes (44%).
  • Conversely the youngest respondents, 16-24’s are the least in favour of higher taxes (30%) with the highest score of all the age groups for wanting a cut on front line public service spending at 43%.
      
• Londoners do not differ significantly from the overall sample; 35% said they’d pay higher taxes, 37% cut front line spend and 28% couldn’t pick one over another.