A new international study of over 6,000 respondents from smart money app, Yolt, has quantified the impact of the coronavirus on adults’ financial income in the UK, France and Italy.
Consumers in the UK, Italy and France saw their income considerably reduced in April compared to March. In the UK, 39% of consumers confirmed that their income had dropped in the last month, with the situation also bleak in France (47% drop) and even worst in Italy (67% drop).
The longer lockdown period in Italy and France may have contributed to the increased numbers of people experiencing loss of income in these markets – a worrying sign of what may be ahead for the UK consumer.
The average amount income was reduced by, in the UK, was 34% – significantly more than the 20% top up covered by the UK Government’s furlough scheme, highlighting the potential financial hardship of many consumers who will be worrying about how to fill the gap and make ends meet. In mainland Europe, the picture was mixed. Those Italian consumers who reported a fall in their income experienced an average drop of 38%, while for French respondents this figure was 23.4%.
When asked how long they thought it would take them to recover financially from the impact of coronavirus, estimates varied by country greatly. Most respondents in the UK said that it would take them longer than four months to recover. Responses in Italy were similar, with the average just over four months. Meanwhile French respondents were more optimistic, with most estimating that they would financially recover from the virus in less than three months.
For now, the main concerns of those left feeling financially insecure in the UK are around meeting day-to-day living costs. The most common worry was about being able to pay bills (31%), followed by meeting rent or mortgages obligations (26%) and buying essential food and medicine (24%).
To help support those who have been affected by the coronavirus, Yolt has recently launched its ‘Lockdown hub’. The hub contains insightful blogs, guides and hints & tips to help people with managing their finances through these uncertain times.
Pauline van Brakel, Chief Product Officer at Yolt, said:
“Any sudden income drop will undoubtedly have an impact on all aspects of someone’s life, from current day-to-day living to their ability to save for the future. The latest unemployment rates in the UK alone are a true sign of the number of people facing financial hardship and many are currently worrying about how to pay fixed costs such as mortgages, rent and household bills.
“For those who are working with reduced income and for those worried about the future, there’s never been a more important time to engage with your money, save where possible and identify areas where you can could cut back.
“For anyone feeling understandably worried about their financial situation, there are lots of free digital tools and resources which can be of help. The Government’s Money Advice Service and independent services like MoneySavingExpert are a good place to start, alongside other services, tools and apps like Yolt.”