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Family budgets squeezed

Monday 21 November 2011 01:00 GMT
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The finances of ordinary families are rapidly worsening, a survey suggests. Markit's monthly analysis of household finances has shown the sharpest deterioration since the summer. It also found the largest gap between the wealthiest and the poorest since the survey began in 2009.

The Household Finance Index fell from 35 in October to 34.6 in November. Any figure below 50 indicates worsening household finances. About 37 per cent of the 1,500 individuals questioned noted a deterioration in their financial situation, while only 6 per cent noted an improvement. The survey also pointed to growing inequality. For those earning less than £15,000, 51 per cent saw their finances deteriorating. Among the highest income group, 19 per cent saw a deterioration. Public sector workers are being hit harder as well. The index for households in this sector fell to 32.9, compared with 38.6 for those in the private sector.

Almost 49 per cent of households said they were less likely to make major purchases, while 7 per cent indicated an improvement.

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