Press release: Scots continue to cut spending
22nd November 2022
New research published today by the David Hume Institute and the Diffley Partnership on economic attitudes and behaviours has revealed widespread pessimism about Scotland’s economic outlook.
9 in 10 Scots (93%) believe general economic conditions are worse now than they were this
time last year and 77% believe the situation will deteriorate further over the coming year.
6 in 10 people (62%) are planning to spend less on restaurants and hotels and 58% are
planning to cut down on leisure and culture spending over the next 12 months.
Almost 1 in 2 (48%) plan to spend less on clothing and footwear.
7 in 10 (68%) already report not turning the heating on when they otherwise would have
and nearly 1 in 5 (17%) of people have skipped meals to save money
Intentions to cut spending have increased for every good and service listed in the survey
since Understanding Scotland began, posing a big challenge for the Scottish economy and
particularly the hospitality sector.
The new Understanding Scotland polling has found that 8 in 10 (79%) of people view the economy as it is currently organised as working primarily in the interests of the wealthy, while 65% of people feel their financial situation has worsened over the past year.
Wrong direction?
Just under half of people (49%) believe that things in Scotland are heading in the wrong direction, the highest percentage providing this answer since Understanding Scotland was launched last year. Dissatisfaction with income levels remains high, with almost 1 in 2 (46%) of people dissatisfied with their income level and a further 55% dissatisfied with their income’s ability to cover the cost of living.
People from the most deprived areas are also being increasingly pushed into financial precarity. One in five (20%) have had to borrow money from family or friends and 19% have used a buy-now-pay-later scheme when they otherwise wouldn’t have. This is despite 22% of this group having changed or looked at changing jobs to earn more and 15% trying, unsuccessfully, to take on more hours/paid work.
During these tough times, 2 in 5 (40%) of people have reduced their donations to charity, while rising prices and inflation are pushing 1 in 5 (22%) of people to cut down on portion sizes to save money.
People from the most deprived areas plan to reduce spending on essentials further this next year: almost 2 in 5 (37%) plan to spend less on eating out and household goods and services (38%).
Parents feel the pinch
Parents, in particular, are feeling the pressure of current economic turmoil: almost 2 in 3 (64%) are dissatisfied with the ability of their income to cover the cost of living and nearly 3 in 10 (28%) reflect that their current financial situation is much worse than it was 12 months ago. This pressure has resulted in more than 1 in 3 (35%) of parents losing sleep due to stress or anxiety about personal finances and higher percentages of parents reporting borrowing money from family or friends and using credit cards or buy now pay later schemes than people without children.
Amidst predictions of further tough times to come following the Autumn Statement, these statistics raise questions of how much worse things can get and how current economic conditions will impact other issues of rising concern among survey respondents, such as poverty and inequality and healthcare and the NHS.
Reflecting on the findings, Mark Diffley, founder and director of Diffley Partnership who conducted the research, said:
“The public in Scotland continue to have widespread concerns about both the of the state of the economy and their ability to cope with the ongoing cost of living crisis.
Although concern and anxiety are widespread, we continue to see those in the most precarious situations feeling most vulnerable and ill prepared, particularly those who live in the most deprived parts of Scotland.
Despite a modest fall in pessimism about the economy over the next year, policymakers and business will be concerned with the finding that spending on non-essential items, like leisure, eating out and holidays, is likely to fall significantly over the coming year.”
Susan Murray, Director of the David Hume Institute, who helped to develop the survey, added:
“The cost-of-living is continuing to have prolonged effects in the ways in which people are choosing to spend their money. Hospitality and culture industries are being hit hardest as people cut back spending due to rising food and heating costs.
Although Scots are less pessimistic about the state of the economy next year, we are still witnessing significant financial stress among families with more than one third of parents losing sleep due to financial stress.”
ENDS
Notes to editors:
Designed by the Diffley Partnership, the survey received 2,191 responses from a representative sample of the adult population, aged 16+, across Scotland. Invitations were issued online using the ScotPulse panel, and fieldwork was conducted between the 3rd - 8th November. Results are weighted to the Scottish population (2020 estimates) by age and sex.
About Understanding Scotland: Understanding Scotland is a high-quality quarterly survey that delivers insights into Scottish behaviours and attitudes towards society, the economy and the environment. The survey fills a vital gap in research, providing the socioeconomic insights and indicators needed for effective decision-making, with regularity and timeliness.