For years, inflation has steadily outpaced wage growth, making it increasingly difficult for many people to keep up with the rising costs of everyday necessities. Even with recent improvements where wages have started to outpace inflation, the struggle to afford certain items remains a reality. This article examines some of the things that have become less affordable over time, highlighting the financial challenges that persist despite the shifts in the economy.
Insurance
Premiums for many types of insurance, including home, auto, and travel insurance, have risen sharply in recent years, partly due to inflation. Car insurance premiums, in particular, have soared, rising six times faster than inflation in 2023.
Education Supplies
The shift from pen-and-paper learning to digital learning tools and platforms in schools and colleges has introduced new costs for access and subscription services. School supplies and textbooks have also risen in price, placing additional financial pressure on families and college students.
Energy
A recent article from Statista charts how the prices of gas, gasoline, and electricity have risen since 2020, driven up in part by Russia’s invasion of Ukraine in 2022 and pandemic-induced inflation. Natural gas has increased in price by 35% since 2020, and the average daily electricity use in the UK has risen by 30%.
Clothing
While fast fashion has contributed to a perception of lower costs for new clothing, the price of quality clothing has increased in recent years. Import tariffs and global supply chain issues have raised the costs of producing apparel and, consequently, retail prices.
Air Travel
The price of airline tickets has outpaced inflation over the past two years. From 2022 to 2023, the consumer price index for airline tickets increased by 25%. But travelers are undeterred, with spending on airline tickets at record highs.
Cars
A recent Bloomberg article notes that “buying a car is more expensive than ever.” The average cost of new vehicles has surged as “pent-up demand left over from the pandemic is keeping sticker prices high even as factory production has returned to full strength,” and used car prices are high because of a low inventory.
Pet Care
Inflation has significantly increased the price of pet food, grooming products, and veterinary care in recent years. Advances in veterinary medicine have extended the lives of pets across the UK but have led to higher costs for treatments and preventative care.
Entertainment and Media
Cable subscriptions have become less common in the past decade as subscription services like Netflix, Amazon Prime, and Disney+ have offered instant streaming. Services for music and gaming have also decreased demand for physical copies, but prices have increased over time. Cinema ticket prices and live event tickets have also risen with inflation.
Fitness and Health
Post-COVID, some gym memberships have risen in price as businesses try to recover lost money from lockdowns. Increasing gym equipment and machinery costs have also driven up gyms’ costs as owners try to keep their businesses operational.
Home Maintenance and Repair
Inflation has caused rising material costs and, in turn, rising labor costs for plumbers, electricians, and carpenters. DIY has also become more expensive as the price of tools and building materials has risen.
Housing
A Guardian report from May 2023 noted that the typical home value has increased by over £150,000 since 2005. The price of renting has also drastically increased in this period. Britain’s housing stock hasn’t increased to meet soaring demand, rocketing up prices and making affordable home ownership unreachable for many.
Childcare
The cost of childcare in the UK has become a significant portion of many middle-class families’ budgets, exceeding the cost of rent or mortgage repayments in some areas. The availability of affordable childcare facilities has not kept pace with demand as the population has increased, contributing to price increases.
Food
In recent years, inflation has driven up grocery prices, particularly since the COVID-19 pandemic. Climate change, supply chain issues, and increased transportation costs have also caused prices to rise. Dining out has additionally become more expensive as restaurants raise prices to cover higher labor and ingredient costs.
Internet and Cell Phone Service
Despite significant technological advancements in the past two decades, the cost of internet and cell phone services has increased. A lack of competition in some areas and upgrades to infrastructure, including the rollout of 5G, have led to higher prices for consumers.
Technology and Gadgets
TechTarget reported in 2022 that inflation has “seen cost increases in areas including servers, storage, and professional services.” Prices rose as employees returned to the office after COVID-19 lockdowns, and employers needed the infrastructure to accommodate them.