Two thirds cutting back on food spend as majority concerned by cost of living crisis

Two thirds cutting back on food spend as majority concerned by cost of living crisis

The number of people who have identified the cost of living crisis as a concern has jumped considerably in just eight months. 

Consumer pessimism is at the highest level seen in nine years with the cost of living a "key concern" for the vast majority of people.

Almost two thirds of people (62%) have said in a new report that they will have to cut back on food spending over the coming year in response to sharp price rises.

The number of people who have identified the cost of living crisis as a concern has jumped considerably in just eight months.

Some 81% said the cost of living increases are a key concern, up from 62% just three months ago and 53% in October 2021.

The data was revealed in Permanent TSB's Reflecting Ireland research, which highlighted the rise in consumer pessimism.

More than half (53%) of respondents feel they are less well off than they were a year ago, an increase from the 32% in January.

Four in 10 (43%) feel they will be less well off in a year’s time, up from 22% when asked three months ago. The last time pessimism about the future was this high was in 2013 when it reached 45%. Only 24% of people feel they will be better off in a year’s time.

Making ends meet is another concern, with 61% describing themselves as “just getting by” financially. 43% of respondents don’t have money left over at the end of the month and 47% don’t feel they could handle a major unexpected expense.

"The rising cost of living is having a deep impact on how we are feeling and behaving. Optimism is fading and anxiety is on the rise, which is a concern," said Claire Cogan, a behaviour scientist and founder of the consultancy Behaviour Wise.

"There is evidence that people are adapting their behaviour to meet the challenges, but there is also evidence that many feel in a financially precarious position. It will be increasingly important over the coming months to build our financial resilience, as upward pressure on the cost of living shows no sign of abating."

Leontia Fannin, head of corporate affairs at Permanent TSB, added: "The cost-of-living issue is likely to dominate the thoughts of Irish consumers through the rest of this year and beyond and it is likely to have significant implications for businesses across the board."

Meanwhile, 55% of people said they plan to switch power or gas provider, up from 49% last year, while 47% plan to switch car insurer, up from 38%.

With Ulster Bank and KBC exiting the market shortly, the survey found the number of people considering switching their current account has doubled over the past year — from 12% last year to 23% this year.

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