According to the latest figures available, the average Isle of Wight household’s borrowing has increased by 12% over the last five years, following the national trend of people taking on more new credit card and car financing debt.
The TUC has warned that household debts are at “crisis level”, blaming austerity and slow wage growth for increasing the burden.
Average IW borrowing
UK Finance figures show the average the Isle of Wight household borrowed around £1,072 in unsecured debt between April and June last year, the most recent period for which figures are available.
Levels of borrowing on the Isle of Wight were much lower than across the South East in general, where the average household took on £1,514 in unsecured debts between April and June 2018.
Local comparison
The figures also reveal in the difference in borrowing across the Isle of Wight.
In the PO32 postcode area (East Cowes, Osborne and Whippingham), households borrowed an average of £1,271, 49% more than the average £853 in PO34 (Seaview and Nettlestone).
The figure, which does not include secured loans such as mortgages, means households borrowed roughly £115 more than during the same three months in 2013.
It means that the area collectively took on an additional £65.5 million in loans including credit card debt, car finance schemes and bank loans.
National comparison
Across the UK, households borrowed an average of £1,378 in unsecured debts, with those in the South East and London generally taking on more than in other parts of the country.
The average amount borrowed in the last five years has increased by nearly 20%.
TUC: “Household debt at crisis level”
The TUC said its own analysis suggested that unsecured debt levels reached new highs in 2018, equivalent to £15,385 per household in the third quarter of the year.
Unsecured debt as a share of household income is now more than 30%, the highest it has ever been, and above the level it reached in 2008 ahead of the financial crisis, said the TUC.
TUC General Secretary Frances O’Grady said:
“Household debt is at crisis level. Years of austerity and wage stagnation has pushed millions of families deep into the red.
“The Government is skating on thin ice by relying on household debt to drive growth. A strong economy needs people spending wages, not credit cards and loans.
“Our economy is not working for workers. They need stronger rights and bargaining powers.”
Article shared by Data Reporter as part of OnTheWight’s collaboration with Press Association and Urbs Media
