Single adult and lower-income homes hit hardest by inflation

The largest contributor to lower income household inflation was the cost of energy while for higher income households it was the restaurants and hotels. 

Single adult households and those on lower incomes are experiencing the highest levels of inflation with levels well above the increases seen in the Consumer Price Index, new figures from the Central Statistics Office (CSO) shows.

On Friday, the CSO published its estimated inflation for each household group for March when headline annual inflation was 7.7%. The rate dropped to 7.2% in April.

The estimates show that single adults living on their own are experiencing the highest level of annual inflation at 8.5%. Single-parent households are experiencing inflation at 8% while households containing two adults with more than three children are seeing inflation at 7.9%.

Households on the lowest income are dealing with an 8.3% rate — the second-highest rate by household group — while higher income households have an inflation rate of 7.3% 

However, while all income brackets experienced a high level of inflation, there was a stark difference in where those increases were seen.

The cost of energy was the largest contributor to the inflation experienced by the lowest 10% of earners, making up 2.4% of their total inflation, followed by price increases in food and drink by 1.8% and rent by 1.6%.

In the case of high-income households, the largest contributor to inflation was seen in what they paid in hotels and restaurants which came to 1.9%, followed by mortgage payments at 1.5%.

Differences in the levels of inflation experienced can also be seen through how the households pay for accommodation.

One-person households experienced the highest estimated inflation rate in the 12 months to March 2023https://t.co/UlolsoUe1t#CSOIreland #Ireland #CPI #ConsumerPrices #Inflation #Deflation #Prices #BusinessStatistics #Business #BusinessNews #IrishBusiness pic.twitter.com/B3sUFC94ra

— Central Statistics Office Ireland (@CSOIreland) May 19, 2023

Those renting from a local authority have an inflation rate of 8.2% compared to 7.3% for those living in accommodation rented from a private owner. Those paying for a mortgage are experiencing inflation at 8.1% compared to the 7.2% for those who own their home outright.

Joseph Keating, statistician with the CSO, said each household has its own unique “consumption pattern of goods” and therefore have a different experience with inflation.

The CSO also published the price changes for different household groups for the five years from March 2018 to March 2023. Mr Keating said over that period overall inflation was 16.9%, but it ranged from 16.0% for higher-income households to 19.1% for lower-income households.

“In the five years since March 2018, the estimated inflation experienced by rented households was higher than the CPI and stood at 18.5% for households that were rented from a Local Authority and 17.4% for households that were renting privately,” he said.