A fascinating report has just been issued by the Office of National Statistics on how the level and pattern of consumer spending has changed over the last 50 years.
Back in 1957, UK consumers spent over 30% of their disposable income on food, with a further 9% on housing and 6% on tobacco. Fast forward to 2007 and the picture changes dramatically. The ONS point out that UK household income has doubled in real terms over the last fifty years.
What do consumers spend their income on now? The proportion spent on food has dropped to 15% and only 1% is wasted on ciggies. However, we spend a higher proprtion now on housing (19%) and transport which has risen from 8% (1957) to 16%.
Transport spending has doubled mostly because of rising car ownership, with three in four households owning at least one car. And real terms increases in rail fares have also helped to increase the overall cost of getting around. One off-setting factor is the cheaper cost of flying with the rapid spread of low-cost airlines.
The report makes fascinating reading, and is a really useful introduction to the concept of market growth.
Which products and services have fallen out of fashion over the period?
Can your students guess what the top ten spending items were in 2006 (it is in the report).
More details here:
http://www.statistics.gov.uk/cci/nugget.asp?id=1921
Further reading from this selection of websites:
Financial Times: ‘Fifty-year journey from austerity to iPods’
The Times: ‘Then we spent it on fags, booze and food. Now it all goes on the mortgage’
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