Business

Spending power for NI households stays stuck again

Asda income tracker shows disposable income in August remained at £123

Food prices are estimated to be unchanged month on month
While households in Northern Ireland may have weathered the worst of the cost-of-living crisis, the amount of disposable income they have each week has remained unchanged at £123, according to the latest Asda income tracker (Julien Behal/PA)
By Gary McDonald

While households in Northern Ireland may have weathered the worst of the cost-of-living crisis, the amount of money they have left for luxuries each week hasn’t improved.

Figures in Asda’s latest income tracker shows that disposable income in the north each week, after all taxes and essential bills are paid, was £123 in August.

That’s the exact same figure as in July, and is just half of the UK figure of £247 per week last month.

And in the last six months that figure regional has improved by a mere £11, up from £112 in March, £118 in both April and May, £119 in June and £123 in July.

Disposable income in the UK as a whole increased by 12% year-on-year in August, the fifth consecutive month of double-digit growth.

While inflation levels as a whole remain unchanged since July, inflation on food and drink slowed to 1.3%.

Prices for essential groceries continuing to drop as inflation on these items eases, UK households can now expect their spending power to continue to improve.

Inflation has also dropped by 5% since last August, and combined with the steadying of spending power, the average UK households will now likely have more cash in their hands in the run-up to Christmas.

But the lowest income households will continue to feel the impact of the cost-of-living crisis for a little longer. The spending power of these households is increasing slower than others, meaning for many people, their net income does not cover bills and essential spending – leaving them with an average weekly shortfall of £66.

While households in Northern Ireland may have weathered the worst of the cost-of-living crisis, the amount of money they have left for luxuries each week hasn't improved
Key UK-wide figures from the latest Asda income tracker (Gary)

Pushpin Singh, senior economist at the Centre for Economics & Business Research (Cebr), while compiles the figures for Adsa, said: “Despite the recent slowdown in earnings growth, annual wage growth continues to outstrip annual growth in consumer prices.

“With inflation now 5% lower year-on-year, further increases in spending power are expected in the coming months.

“That said, growth in spending power is expected to slow as wage growth eases further and inflation remains sticky at a level above the 2% target for some time. This could mean some households will take longer to fully escape the effects of the cost-of-living crisis.”