Posted on Thursday 22 October 2015 by Ulster Business
Pictured (l-r) at the Asda Income Tracker NI Roundtable event at Riddel Hall, Rob Harbron, Economist, CEBR; George Rankin, Senior Director Asda NI and John French, Chief Executive, Consumer Council.
Consumers in Northern Ireland are seeing their disposable income increase but have a long way to go to catch up with their neighbours in the rest of the UK.
Those are the findings from the latest Income Tracker report from Asda prepared by CEBR which revealed that families here have £97 of so-called discretionary income to spend each week, after paying for essentials such as food, energy and housing.
While that is 15% up on the same time last year, it’s still less than half that of the UK average of £192, a situation caused by lower salaries and higher costs for both food and energy.
The average wage in Northern Ireland stands at £18,764 compared to a £22,044 across the UK as a whole and we have the highest percentage of workers on or below the minimum wage, the report said.
And when it comes to the high earners, the gap widens further.
The average salary in the top 10% of earners in the UK as a whole is £48,250 while for Northern Ireland it stands nearly £9,000 lower at £39,549.
But spending power here improved by the highest percentage of all UK regions, while budgets across the region enjoy the bonus of a fall in the price of energy and food compared to the same time last year.
“After a difficult few years since the recession, it’s encouraging to see household spending power picking up quickly in Northern Ireland,” Rob Harbron, Managing Economist at CEBR said. “Consumer spending is helping to support the economy this year as a result. We are not quite out of the woods yet though as higher inflation next year, the prospect of higher interest rates and continued government cutbacks will all have their effect on family finances.”
Asda’s Chief Customer Officer Barry Williams said the fact much of consumer incomes is spent on essentials in Northern Ireland means we’re benefit more when prices for food and fuel fall.
“Traditionally, people in Northern Ireland spend more on essential items than any other region and they’re benefitting in falling prices of vehicle fuel, energy bills and food - it’s also reassuring to see that wage growth has recently accelerated and all of this is contributing to some of the fastest spending power growth in the UK. However, the impact of the financial crisis still looms with customers sticking with their savvy shopping habits and reprioritising their spending on treats and activities with their families - remaining vigilant that the economic landscape can quickly change.”