A study completed by the Post Office shows that over 4 million workers can not make their income last to the end of each month, affecting their health and causing stress and sleepless nights.
They are on a financial tightrope, relying on credit cards, overdrafts, and savings to survive until the next pay day, creating a vicious circle of debt. For many, getting paid brings their bank balance back to zero as they face yet another month of trying to juggle their finances and getting deeper into the red.
John Wilcock, head of financial services at the Post Office, told the Daily Mail ‘It is a concern that we are becoming “Pay Day Britain”, just counting down to the next pay cheque. ‘However, the bigger worry is that so many workers are struggling to balance their income versus their outgoings every month.’
With constantly rising costs in household bills, pay freezes, and the lowest annual rate of pay increase since records began in 1948, many are facing very, very tough times. According to the Office of National Statistics, the average annual increase in pay is at an all-time low, at just 1.3%.
With the average rate of inflation at 2.8%, workers are finding harder and harder to keep up with the rising costs of basics, such as energy and fuel.
Government changes to VAT and benefits such as child benefit and tax credits add to the misery of lower paid workers.