What impact is the cost-of-living crisis having on people and the workforce?

The cost-of-living crisis has been an ongoing, prominent issue in the UK since late 2021. The rising prices of goods and services have significantly impacted people’s savings and their ability to manage expenses.

A YouGov survey commissioned by the Chartered Institute of Personnel and Development (CIPD) showed that in winter of 2023, only 48% of workers reported that they were managing to keep up with their bills and credit commitments. Additionally, the percentage who said that these were a constant struggle for them rose from 8% to 12% between 2022 to 2023.

Furthermore, CIPD found that as of 2023, 47% of UK workers expressed their intentions to quit their jobs within the next year – financial struggles were found to be a leading factor of this.

Based on the CPI measure of inflation, food prices had risen by 5% as of February 2024 compared to the previous year. This high increase in inflation has been noticed by everyone across the UK, particularly over the last year as people continue to struggle with general food shops for themselves and their families.

I talked to a part-time college student and part-time retail worker who would prefer to remain un-named. “Being on minimum wage means I need to look elsewhere for work to be able to afford anything but no matter how great a job looks; I have to take the pay into consideration.” Even young students are feeling the pressure to leave their jobs, despite the majority living at home and not having to pay any significant bills; general costs of clothes, food and travel still leave them in a situation where they feel as though they cannot live off the national minimum wage in part-time employment.

“The minimum wage increase has only given me an extra couple of pence to my paycheck, with costs rising, it’s made little to no difference for me.” Despite the minimum wage going up by 21.2% for 16–17-year-olds as of April 2024; their pay rate per hour is at £6.40. Taking into consideration that this age range is still required to be in a form of education – needing to pay for food and transport and only able to work part-time due to this, it leaves them at a significant disadvantage due to rising costs of food and services.

A study conducted by WTW Global Insurance Company found that 36% of the UK live paycheck to paycheck with no money left at the end of the month for emergencies or unexpected payments. Even those earning over £100,000 annually- 26% claimed they had no money left over at the end of the month. With rent, household bills and additional monthly expenses rising; around 2 million young people aged 18-34 have been forced to move back in with their parents – while around 4.8 million still have no choice but to stay at home.

A young retail worker I spoke to, who would also prefer to remain un-named, discussed with me their experiences of living on minimum wage, whilst still searching for full-time work. “I live paycheck to paycheck being on a little over minimum wage; I can’t afford to move out of home and still afford to pay all my additional monthly costs.”

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