FinanceNewsBritain’s 11 million pensioners are feeling the pain of the recession – and promising to punish the Government at ballot box Britain’s 11 million pensioners are feeling the pain of the recession – and promising to punish the Government at ballot box
By Tony Watts - Editor - 02/06/2009
A detailed survey of over 1600 older people by the national campaigning paper and website Mature Times shows that, while many are riding out the recession, millions of the UK’s retired are taking a financial hammering in the recession as returns on their savings dwindle – and that 24.7% of them are likely to switch votes to the Conservative Party as a direct result.
As older people are, statistically, far more likely to vote than the younger generations, the fall-out for Labour is possibly even more significant than recent polls – which look at a broad spectrum of the voting public – suggest. A quarter of the voters at the 2005 general election were aged 65+, and more than two in five were aged 55 or over (source = Ipsos Mori).
Other results show that:
• 77% have had to cut back on spending
• 55% have made changes to savings
• 25% are having to help their children financially
• 51% are spending less on food – many by switching to ‘value brands’
• Charity donations are down by 50%
• 33% are switching supermarkets
• Foreign holidays have been cut by 8 days / year
• The Government and the banks share most of the blame for the recession
Some 1624 people took part in the Mature Times survey, 97% of them aged 50 and over, and around 55% of pensionable age. The data was gathered online and through readers filling in and sending off the survey printed in the April 2009 edition, and the sample is believed to be one of the largest ever for such a survey assessing attitudes amongst older people. Certainly it is the largest taken to assess the impact of the current recession on this part of the population.
Says Mature Times editor Tony Watts: “When you break them down, what the figures reveal is that certain sections of the older community are suffering significantly more than others. Over a fifth (21.1%) say that their savings and investments are ‘essential’ for day to day to living – and returns on those have plummeted in the last year, leaving many to eat into their capital to get by. That percentage can be extrapolated to assume that there are over four million older people in the UK who are really suffering, because their modest savings mean they will qualify for little or no help from the Government.”
Two thirds of those taking part in the survey said that they had switched some or all of their savings around in an effort to get better returns or to gain access to their capital.
Over a third of the respondents have made drastic or significant cuts in their spending, and this is reflected in their shopping patterns. Some 11.1% are buying less meat, 43.6% are spending less on vegetables and almost four out of five say they are now more likely to be purchasing ‘value brands’ – so the recession is really impacting upon people’s diets. A third say that they have changed their supermarket shopping habits. Surprisingly, the biggest loser here appears to be Tesco, while the biggest winners are the discount stores Aldi and Lidl.
Cutbacks in spending will certainly affect the tourism and leisure industry. Around a third of respondents said they would be spending fewer days abroad (on average 8 days fewer) and on holiday in this country (on average two days less). Some 13.3% are no longer eating out, and 27.6% are not buying new clothes.
But the situation is not all ‘doom and gloom’, according to Jane Silk of Mature Marketing, which partnered Mature Times in carrying out the survey.
“There is a widespread assumption that the most detrimental effects of the recession are being felt by those of working age. But if you’ve kept your job, you’re probably not doing too badly. The same is true if you have a guaranteed company or private pension. For these people, there are bargains to be had on the High Street and lower interest rates on mortgages are allowing them to reduce their borrowing. Home improvements, plasma TVs and computers – even cars - are all being snapped up from retailers by those with cash in their pockets and purses according to the Mature Times poll.
“Shifts on this scale in the spending and investment habits of the 50+ population are hugely significant to retailers and financial institutions: it is widely accepted that these people hold 80% of the disposable wealth in this country.
“However, the potential impact on our charities is particularly worrying: one half of our respondents say they are reducing donations… and the average reduction is by a massive 50%. Older people account for a very high proportion of charitable donations, and while the majority is in the form of legacies, any downward shift in giving will leave many good causes struggling to deliver their vital services to society.”
Another fascinating figure to emerge is that a quarter of older people are having to help their family financially.
According to Tony Watts, editor of Mature Times, the people reading the detail of the report with most interest should be the political parties. “First of all we asked readers who they blamed for the current crisis. Readers had the chance to allocate ‘percentages’ of responsibility, recognising that this has come about through a series of events and decisions. And when the figures are boiled down, the blame is shared equally (at 25% each) by the current government and the banks. Around 1 in 10 felt that the previous Tory government should shoulder some of the blame because of the borrow and spend culture they helped introduce.
“The media, the public itself and global factors beyond our control made up the numbers.
“So how will all this unwind in the event of an election? A mere 35.5% of respondents said that the current economic crisis would not change the way they will vote. Of those who will change their vote, 44% say they will change to Conservative... so a massive electoral swing seems imminent.
““This survey took place before the current MPs’ expenses scandal came to light, but with all parties coming in for criticism over that, the recession impact may well be longer lasting and more profound.”
Distilled down to the anticipated net effect on the polls, 24.7% are more likely to vote Conservative; 13.9% are more likely to vote Liberal Democrat, and slightly more than that (15%) are considering voting for a minority party. Only 27 people told us that the current government has done a good enough job to merit them switching their vote to Labour.
Dick Stroud, the UK’s foremost marketing expert and commentator in the 50+ sector, says he has been astounded by the results. “Make no mistake, this is the best research I have seen about the way the recession is affecting the older consumer – and what a complex picture it presents.
“Large numbers of older people are suffering badly, but for many others the recession is having little or no impact. In fact the result show that 25% are able to provide financial help to their children. Marketers need to get smart at understanding the winners and losers of the recession – in that respect, the 50-plus consumer is no different to any other age group.
“There is often a very naïve assumption on behalf of marketers and politicians alike that ‘older people don’t like change’. That’s just not true - this is the generation that has seen more change in their lifetimes than any other - and this survey shows that the volatile economy is making 20 million people reconsider where they spend their money and who will get their vote.”
Supporting notes:
These statistics were obtained by Mature Times newspaper during April 2009 (except where indicated).
‘The Recession and You’ survey was conducted off-the-page for the off-line readership and by electronic survey to the database of Mature Times On-line subscribers.
The maximum total respondent sample size is 1,184 for on-line and 458 for off-line (paper entries) creating a combined total of 1,642.
Both the questionnaires were self-completion, with most of the electronic survey requiring optional, rather than compulsory answers.
All sample sizes are robust, except where identified for combined samples of less than 80 respondents.
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