Low-income families see costs soar during pandemic

Low-income families with children are twice as likely to have increased their spending during the pandemic so far than the rest of the population, according to new research.

The study by the Resolution Foundation and the Nuffield Foundation-funded Covid Realities research project at the University of York found spending patterns of low-income families with children have been very different to the wider population during the pandemic, and during the first lockdown in particular.

More than a third (36%) low-income households with children have increased their spending during the pandemic so far (rising to 37% during the first lockdown), compared to around one-in-six (18%) who have reduced their spending.

Among high-income households without children, 13% have increased their spending, compared to 40% who have reduced it.

The report highlights three main reasons for these extra pandemic pressures.

First, parents identified that having children at home 24 hours a day led to higher food and energy bills, while the need to entertain them during the lockdowns, in place of activities such as visiting families and public libraries, has brought additional costs.

Second, parents identified additional costs associated with home-schooling, such as acquiring laptops, paying for internet access and obtaining additional study materials.

Third, families noted that the cost of buying food had risen, due to the reduction in store promotions, and because the need to shield has forced many to use more expensive home delivery options, while the need to avoid public transport means those without access to a car have had to use more expensive shops closer to home.

With the third national lockdown likely to last several months and put families under further pressure, the report calls on the chancellor to urgently do more to support family incomes during the pandemic.

‘The pandemic has forced society as a whole to spend less and save more. But these broad spending patterns don’t hold true for everyone,’ said Resolution Foundation chief economist, Mike Brewer.

‘With the country going into another lockdown for at least the next few months, the Chancellor should acknowledge the pandemic pressures that families with children face and reconsider plans to cut Universal Credit in just a few months’ time,’ added Mr Brewer.

Dr. Ruth Patrick, a lecturer in social policy at the University of York, who leads the Covid Realities research programme added: ‘The idea of being able save money during this pandemic is just a world away from the experiences of the parents and carers we’ve been working with through the Covid Realities research project.

‘Parents have found their spending increase, as some of the usual strategies they use to get by on a low income – shopping around for the best deal, going to families and friends for a meal when the cupboards are empty – have become suddenly impossible. The conditions the pandemic has created make it harder still to get by on a low-income, creating extra financial pressures, rooted in the requirement for families and their children to stay at home and restrictions on household mixing.’

Photo Credit – Stevepb (Pixabay)