Recession hits vulnerable low income families

Recessions have macroeconomic effects - a topical discussion at the moment is the impact of the slump on the UK economy’s productive capacity and underlying growth rate - but the effects on individuals, families and local groups can often be over-looked by the broader macroeconomic debates. This news article refers to new research highlighting the damage caused by the recession on younger people whose pay and jobs are vulnerable.

These groups

1/ Are at higher risk of having to accept cuts in their money and real wages 2/ Are more exposed to a reduction in working hours and therefore lower weekly gross incomes 3/ Many have a personal inflation rate higher than the published data for CPI and RPI 4/ Have higher levels of unsecured household debt on which interest rates have risen in recent years and not fallen

It also focuses on just how little people on below-average incomes can afford to save.

“More than half of people on low incomes have less than one month’s salary saved and 40pc are not saving into a pension, while 53pc have unsecured debts, averaging £5,200.”

More here: Younger workers hit hardest by the recesssion, says think tank