An increasing number of individuals in full-time employment, including professions like nursing, are reaching out for guidance on managing debt, highlighting the struggles faced by a growing segment of younger workers in meeting financial obligations.
Recent data revealed that escalating rents and the reliance on credit to combat the cost of living crisis have propelled more full-time employees to seek support.
The UK’s largest debt advisory service has raised concerns, noting that a fresh wave of workers is trapped in debt. StepChange assisted 183,403 individuals last year – a 10% surge from 2022 – equivalent to nearly one new client every three minutes.
There has been a consistent rise in the percentage of full-time workers seeking assistance, climbing from 38% in 2021 to 44% by the close of last year. The organization highlighted a broadening spectrum of individuals grappling with debt issues and “negative budgets,” where their earnings no longer cover essential expenses. Nurses, call-center employees, and other white-collar workers are among those affected.
Approximately 3 million full-time workers in the UK are facing problem debt (unable to afford debt repayments), as outlined in the upcoming report “In Work, But Still in Debt.” Around a fifth of the advised full-time workers have a negative budget, with a quarter attributing their debt to rising living costs.
Concerningly, there is a significant debt burden among workers under 40, who have encountered substantial rent hikes in recent years. This age group is overrepresented among those seeking assistance from the charity, with about two in five of StepChange’s full-time working clients renting privately.
Despite government reports of declining inflation, experts at the charity fear that many working households have been managing the increased cost of living by depleting savings and relying on credit cards.
Peter Tutton, StepChange’s head of policy, expressed, “The cost of living crisis has widened the vulnerable income bands susceptible to falling into debt. We are witnessing more individuals with negative budgets seeking our help. Additionally, individuals with slightly higher incomes are seeking debt advice.”
He added, “The trend of more people in the private rented sector continues. A disproportionate number of our full-time employed clients are aged 18 to 24, facing challenges due to rising living costs and lower wages in precarious jobs.”
The charity’s warnings resonate with similar findings by Citizens…
2024-04-21 01:00:50
Post from www.theguardian.com