Half of households to spend less this year due to rising prices

A new survey shows that nine in 10 consumers are feeling the pinch of rising fuel costs and 77% have noticed an increase in their shopping bills

The cost of living has risen by 7.3% since April 2021, according to the Central Statistics Office.

Nearly 50% of households said that they were likely to spend less this year to mitigate the rising cost of living, according to a new survey by Taxback.com.

Of more than 1,200 people surveyed, nine in 10 said they were feeling the pinch of fuel costs and 77% had noticed an increase in the price of their shopping bills.

If inflation continues to rise throughout the year, 11% of respondents said that they would ask for a pay rise, while just 3% would seek advice from the Money Advice and Budgeting Service (MABS).

Only a quarter of those surveyed said that they plan to save more.

"The survey suggests that spending less is by far the most popular measure people plan to take to curb the impact of rising prices,"  said Taxback.com director Barry Cahill.

This will have a knock-on effect on the wider economy, particularly at a time when businesses are trying to recover from the pandemic.

“While inflation is a source of financial strain on households, from a business perspective too, inflation creates many challenges. 

“Labour costs are on the increase to meet living costs, and the cost of rent, fuel, and other goods and services needed to run a business are all rising. 

"It’s putting pressure on smaller businesses to increase their prices to consumers, which in turn puts them at risk of losing customers to bigger companies with larger margins."

The cost of living has risen by 7.3% since April 2021, according to figures from the Central Statistics Office.

As of December last year, the survival rate for businesses in Ireland was 84%, with more than 10% of enterprises at risk of closure by the end of 2021.

“It really has been one thing after the other for consumers and for businesses for the last few years," Mr Cahill said.

"As consumers, we are all grappling with meeting the rising cost of living and having to adjust our everyday and wider spending to try to meet and retain as much of our essential and discretionary spending as we are used to."