The average UK family’s weekly disposable income reached a high of £160 in June for the first time in 2013, according to figures released yesterday (July 22) by Asda.
This figure is up by £5 a week from the same month two years ago, but remains well below its peak of £165 seen in February 2010.
The supermarket chain’s Income Tracker said weak wage growth was a key factor, with average pay (excluding bonuses) up just 1% in the three months to May – one of the smallest year-on-year rises on record. The continued rise in inflation of essential items, up 0.1 percentage points to 3%, also added to the squeeze.
Gas and electricity costs, for instance, were up 8.3% and 7.7% respectively against a year ago, while clothing prices increased 3.1% – the highest rate since March 2012.
Petrol and diesel prices, which have been in negative or negligible growth for much of the past six months, have also started to rise year-on-year again, up 1%, putting further pressure on household finances.
Across the regions, there was good news for households in the North West, which witnessed a £5 increase in disposable income year-on-year. At the other end of the scale, households in Northern Ireland saw a decline of £4 over the same period.
Asda president and CEO Andy Clarke said: “Although customers don’t seem to be any better off than they were this time last year, a positive rise in retail sales indicates a return to cautious spending.
“It’s unlikely that consumer confidence will be fully restored until we see a significant improvement in family finances. But the good news is that the cash in our customer’s pockets appears to be stabilising.
“With the recent heatwave and two British sporting victories in the bag, consumer spirits are high, hopefully leading to a brighter outlook for July.”