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Comment by kypro | Hacker News Reader

I don't know how this is possible. State pensions and universal credit went up 10% last year and will be going up another ~8% this year. I understand inflation has high, but most people have a lot more money coming in to make up for that...

Are people just deciding not to spend their extra income? Everyone I know seems to be doing fairly well right now honestly, especially now that energy prices are coming down.

The job market isn't great, but that's really the only thing that I've seen that looks recessionary? And either way unemployment is still low.

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The only people I know who aren’t saying they’re struggling are those on high incomes with low fixed mortgage rates. Outside of that everybody is telling me they’re struggling.

> but most people have a lot more money coming in to make up for that...

Absolutely not. Honestly, I can’t fathom how you have such a warped view of how the average person is doing. Your social circle must be exclusively asset heavy, mid-high income folk, which is far from most people.

My partner and I have combined income of >100k and are significantly worse off compared to a few years ago.

About same income and yeah we are worse off than a few years ago, in reality it just means I'm saving less each month which I realise is a fortunate position relative to almost everyone else (I know many people who not only can't save but are net negative each month which isn't sustainable long term).

The country is currently utterly fucked - even if Labour make sensible decisions I think we are looking at a decade or more and we know that once they've been in for a couple of years the media will do it's usual hatchet job to lay the blame at their feet - the tories are still blaming labour and they've been out of power for fourteen years.

I'm very working class. Almost everyone I know outside of work is either unemployed or retired so I don't think it's that.

Like you I'm personally worse off for sure with tax increases and mortgage increases, but obviously most people don't have mortgages, pay much tax, and most people get help with things like fuel bills.

I guess I'm just surprised that given how much extra money the average person is getting that the economy is doing so poorly. You're right, I might be out of touch though... All I'm saying is that this doesn't align with what I see personally, and I'm surprised given the extra income most people are getting that there isn't more economic activity, but clearly I'm wrong.

> most people get help with things like fuel bills

No they don't? What are you referring to?

There really is not a lot of extra money coming in once you properly account for inflation. Energy and fuel inflation has hit productivity of businesses pretty hard as well as individuals.

Do you live with parents? I can’t think of any other way you could be so disconnected.

> given how much extra money the average person is getting

This just isn’t reality. Price increases have been far greater than pay increases, it’s as simple as that.

> most people don’t have mortgages

Most people do either have mortgages or pay rent which pays their landlord’s buy to let mortgage on the house they live in. Mortgage rates and rents have both spiked very sharply. Along with energy bills that’s a huge chunk of most people’s expenses.

> but obviously most people don't have mortgages

Most people in the UK either have mortgages or pay rent (and rent tends to be more expensive than mortgage payments)

> and most people get help with things like fuel bills.

... Are you under the impression that most people in the UK are pensioners?

Do you and people you know own assets? Not accusatory - it's just there's a lot of working class people who can't afford to feed their kids.

It's about the cost of housing / basic necessities sucking up money from the middle classes. The money accumulates towards assets so people who own them don't notice anything is wrong (quite the contrary)

>The money accumulates towards assets so people who own them don't notice anything is wrong (quite the contrary)

"Then people should just buy a house to protect themselves from poverty" - Chancellor of my country

When I realize I should have bought a home in 2012 instead of being in middle school.

Just had an idiot on Facebook tell me that tenants are dumb because they didn't save up enough to buy a house whereas landlords are smart.

Yeah, we all start with the same opportunities.

Yeah a lot of stuff has gone up in price. Mortgages are a big one. Car insurance has rocketed as well.

Wages - not so much.

I don't believe in a country that has food banks and free school meals that anyone reasonable is failing to feed their kids.

You can't just turn up at a food bank, it's not a free supermarket, you need a referral from social services, and their capacity is limited.

(anyone blaming poor people for badly managing their finances can be dismissed out of hand; this is a multi-century-old excuse that is simple ignorance)

>(anyone blaming poor people for badly managing their finances can be dismissed out of hand; this is a multi-century-old excuse that is simple ignorance)

Well that's an interesting statement, considering that the fast food, alcohol and gambling industries are booming in the UK.

Free school meals don’t happen everywhere at all times. Food banks are incredibly stretched. Many people are not “reasonable” but have alcohol/ drug dependencies or mental health issues and so their children suffer. Even if they manage to give their kids enough food the rest of their life can be incredibly difficult.

"can't afford" is not "failing to". If you have no money and because of that get donated food to give to your kid, you still couldn't afford it.

Food banks don’t help much if you can’t afford to cook the food you are given.

https://www.theguardian.com/society/2022/may/09/more-than-2m...

Notice I said 'can't afford to' which your comment appears to support. I am being pedantic because there is an important distinction. If people can't spend money on feeding their own children they are certainly not spending money on things that usually support a healthy economy.

So we agree they aren't failing to because of the support that is given but at the same time they can't afford to? I'm not sure if that says more about the economy or how people manage their finances.

Giving a person a tin of beans which they will eat that day, instead of a fair wage and an affordable home does not make them any richer. It's frustrating to constantly go over basic facts with fools who live in a bubble. This is a systemic problem not a moral one.

> Everyone I know seems to be doing fairly well right now

Outside the uk hn bubble many, many people are struggling. Rent, gas and electric, food are all very expensive. Most wages haven't risen anywhere near inflation for years, never mind exceeding it.

Fourteen years of austerity topped off by brexit and a succession of incompetent governments and a pandemic - and the country feels like its on its knees to me.

The UK is shockingly poor outside of London. The bigger cities have some moderately prosperous areas, but many towns are turning into boarded-up wastelands.

It's basically Detroit around 2000. And without free movement to the EU, there's nowhere to go.

Erm... most people in the UK do not have more money coming in to make up for that at all. Plus, tax band thresholds have been stagnant for over a decade - so we're hit with a double whammy of massive inflation, plus tax threshold inflation via the backdoor.

Meanwhile, wages are not remotely keeping pace.

Recent price shocks for gas/electricity for people and companies, ongoing squeeze on local councils / public services. Impacts of brexit and other government austerity policies.

Lots of people live close to paycheck to paycheck, not having any savings for emergency’s. It certainly stops any optional spending for both households and companies.

> I understand inflation has high, but most people have a lot more money coming in to make up for that...

Do they? I certainly haven't had an inflation-matching pay rise.

My salary in the last few years have jumped from 48k to 54k to 75k (and now have £6-£7k of extra income too, in interest etc)

But I had to move jobs 3 times in 2 years to get those raises.

And honestly, it still doesn't feel like enough.

Tell me 5-10 years ago I'd earn £75k and I'd think that was going to be amazing, now a £75k salary kinda just feels like an average salary. And I have no kids! I don't know how people on average salaries with children are coping at all.

Come on, 75k (nevermind 6k on top) with no children... That is extremely good, probaly the top 5% in the country.

Median income is about 35k, which means half the people earn less and you earn more than double that with less expenses.

It's good relatively because a lot of people in the UK are very poor. In London (which is probably where you are if you're getting paid that much) £75k does not get you particularly far.

Me neither, but relatively speaking presumably anyone on HN (as long as employed) is ok anyway. I think GP meant people who are relatively poorer/struggling anyway, since they started:

> I don't know how this is possible. State pensions and universal credit went up 10% last year and will be going up another ~8% this year.

(For those not in the UK: 'universal credit' is not UBI, it's state benefits - 'universal' in the sense of replacing various specialised benefits (housing, job-seeking, ...) that came before it.)

i.e. if you're 'actually' struggling (not just like, stressed about money while you sit on your new sofa and watch TV comfortably warm and then open the window because you lit the fire and now you're too hot (occasionally guilty!)) then you ought to be less struggling now and going forwards than a year or so ago, I think is the point.

> State pensions and universal credit went up 10% last year and will be going up another ~8% this year. I understand inflation has high, but most people have a lot more money coming in to make up for that

Those are exactly linked to CPI inflation: https://commonslibrary.parliament.uk/research-briefings/cbp-... , so no net increase.

Energy is probably the most critical one: https://www.ons.gov.uk/economy/inflationandpriceindices/arti...

"Around 4 in 10 adults (41%) who pay energy bills said it was very or somewhat difficult to afford them." "Meanwhile, around one in five (19%) adults reported that they were occasionally, hardly ever, or never able to keep comfortably warm in their home in the past two weeks"

> Everyone I know seems to be doing fairly well right now honestly

We're not representative of the general public here.

My personal theory is it's the continual lack of real investment, public or private, which is biting. Capital assets gradually wearing out, while the productivity per person falls.

The people you know probably have a house and own stocks. If you have to pay rent and live exclusively from the monthly remuneration of your work(wage) then in this case you're screwed.

I have had below inflation pay rises the last two years, and none this year. And I work in the financial sector and do better than most.

What extra income? You sure you live in the UK?

This is the most out of touch take I have heard recently. The overwhelming majority of people are struggling right now. You live in a bubble

It’s actually baffling.

> I don't know how this is possible. State pensions and universal credit went up 10% last year and will be going up another ~8% this year. I understand inflation has high, but most people have a lot more money coming in to make up for that

State pensions, UC the rise in minimum wage and the rise in the NI threshold all benefit those on the lowest incomes the most.

People with unearned (investment income) income are mostly OK too.

The problem is more of a squeezed middle one. People with nigh mortgage payments relative to their income. People paying more tax on an income that has increased in line with inflation (regardless of whether you moved into the standard rate band, or are paying more higher rate). People who ran up debt during covid and its aftermath.

A high proportion of people on HN.

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