The Rising Cost of Living Crisis and its impact on Family

Rocketing energy costs, global food shortages, rising inflation, benefit cuts, cost of housing, wage stagnation, straining household finances and the ongoing aftershocks of a worldwide pandemic, have left Britain reeling in the wake of a cost of living crisis.

As the price of basic necessities continues to rise faster than average incomes, families are struggling.  The implications of the cost of living crisis are not only economical, there are huge social and emotional ramifications too.

For countless families, the milestones in life: going to university, career progression, getting married, having children, buying a home and retiring, are feeling more like a millstone around their necks, than a crucial life stage.

Careers

Career trajectories are changing.  The cost of living crisis means more than 27% of young adults in the UK are now re-evaluating their finances and career choices.  They are prioritising apprenticeships over higher education - an opportunity to earn money whilst studying (and not incur student debt).

ClickUp revealed in a recent study, that 26% (7.7m million) of people in the UK, are planning to change jobs as a direct result of the crisis, whilst others have taken on a second job - working more than 48 hours a week.

Additional work or a “side hustle” can impact greatly on work-life balance.  Not only is the risk of burnout higher, but it makes pursuing career advancement opportunities more difficult.  However, this is a choice many (38%) are forced to make…

Women in particular, are experiencing financial strain.  There are three times more women in part-time work than men, and a fifth of women are paid below the real living wage, according to The Living Wage Foundation. 

“Women are usually over-represented in part-time roles, but now they are having to take on more hours to survive. This has huge implications for relationships, mental health and leisure time, as caring responsibilities fall largely on their shoulders too.” says Annette Heslop of the National Women’s Committee.

For many families today, making more money is the priority rather than job satisfaction, learning or climbing a career ladder.  

Love and Marriage

The cost-of-living crisis is also forcing many to rethink their love life.  

A sex report by Hims revealed the number one factor affecting 42% of respondents dating and sex life, was the rising cost of living.  In fact, 13% admitted they were quitting sexual relationships altogether, saying “with the economic and political climate, things are complicated enough already.” - For Hims, Sex Report, 2023

Romantic wining and dining is coming at a cost many are finding too steep at the moment. Dating app Bumble has found over a quarter of people are now implementing stricter cost-caps to their dating lives.  Almost half (42%) are choosing modest date locations to avoid any pressure or stress about money.

If you do get lucky and find the One, the average cost of a wedding today, according to Hitched, is £18 400.  A hefty sum at the best of times, but in the current economic climate, a considerable cost burden. 

Marriage rates are decreasing however, with 26% of couples feeling the impact of rising costs and choosing less elaborate weddings, delaying, or cancelling their nuptials altogether.

Cohabitation is on the increase, with many couples considering fast-tracking their relationship by moving in together to save on living costs.

On the flip side however, a new survey reveals nearly 60% of people say the cost-of-living crisis has negatively impacted their relationship.  Over a quarter (30%) admit they’re only staying with their partner because they fear “not being able to afford living alone.”

Unfortunately, this is particularly apparent for domestic abuse victims. Figures from Women’s Aid recently revealed that 73% of women said the economic crisis has made it harder for them to leave their abusive partner physically or financially.

Effect on children

While many are experiencing the current impact of the increased cost of living, the long-term lasting impact on the youngest of society, cannot be ignored.  

There are 4.2 million children in the UK living in poverty.  “This crisis means more children will be going to school hungry and going to bed cold. Children are already feeling anxious and worried because of the stress at home, and it's only going to get worse.” says Courtney Sutton, Action for Children.

According to CPAG, children living in poverty frequently report feeling excluded and embarrassed, citing it as a “key source of unhappiness.” All areas of a child’s life are adversely affected by poverty: home, school, friendships and more.

When families are struggling to make ends meet, children may experience stress, anxiety and uncertainty about their future, leading to mental health issues, depression, anxiety, and low self-esteem.  

“Child poverty impacts on their ability to enjoy their childhoods and achieve their aspirations.” - CPAG

Home sweet home

As the cost-of-living increases, it becomes more difficult for people to afford homes.  According to new research 72% of prospective first-time buyers have been impacted by rising mortgage rates and inflation, causing families to delay purchasing their first home.

More and more people in their 30s, 40s and 50s are turning to renting as a result with SpareRoom reporting that the number of people living in shared houses has increased by 400 percent in the last ten years.  

Whilst owning a home is out of reach for many, renters too are feeling the pinch, with almost 2.5 million either behind or struggling to pay their rent (an increase of 45% since April 2022).

Confronted with very limited options to pay their rent, many families are facing the terrifying reality of no longer being able to afford their home and are at real risk of homelessness.  

Having a roof over one’s head is no longer a given.  New research from Shelter reveals that 271,000 people are currently recorded as homeless in England - of which includes 123,000 children.

Retirement

Unbiased revealed in a recent survey, three quarters of those aged 50 and over are worried about how the cost of living will impact their retirement, so much so, they are contemplating reversing their plans.

This is a consideration backed by the UK Government: Chancellor Jeremy Hunt recently announced a “Returnership” initiative in his 2023 Budget, specifically designed for over 50s looking to return to work.

There is a potential for conflict, however: “Both younger and older generations have prejudice against each other — older workers believe millennials are entitled and expect everything from their employer and an immediate pay-off. Younger workers believe older ones had it easy, and are incapable of adapting to new trends,” says  Thomas Roulet, Financial Times.

Research has shown a multigenerational workforce is advantageous, with older people often having invaluable institutional knowledge and lived experience to pass on to younger colleagues.  Younger people growing up in the digital age, have a greater exposure to digitalisation and innovation, thus more embracing of new technology and agile ways of working.

This piece is part of our Modern Families campaign.  Read more about the wider campaign here.