ABOUT: A recent report by StepChange highlights the disproportionate impact of economic challenges, such as the COVID-19 pandemic and rising living costs, on women in the UK.
LINK: https://www.stepchange.org/policy-and-research/women-and-debt.aspx
Summary
The StepChange November 2023 report, “Unravelling Women’s Debt Dilemma,” delves into the financial difficulties faced by women in the UK. The study shows a rising trend of women seeking debt advice, with 64% of their clients in 2023 being women. Factors such as lower average income, higher childcare and essential living costs, and a significant gender pay gap contribute to this trend. Single mothers and women from minority ethnic backgrounds face particularly acute challenges.
Key Points and Ideas
- 64% of StepChange’s clients in 2023 were women, up from 60% two years ago.
- Women face lower incomes, higher expenditure levels, and are more likely to have negative budgets.
- Childcare costs and the gender pay gap exacerbate financial challenges for women.
- Universal Credit is a significant income source for many women but often insufficient to cover expenses.
- Single mothers, especially those on Universal Credit, struggle more with living costs and debt.
- Women’s average expenditure exceeds their income, leading to more arrears in essential bills.
- Gender disparities in unsecured debt amounts exist, with women having lower debt levels than men.
- Intersectional factors like ethnicity, family composition, and location influence women’s financial experiences.
Key Statistics
- Women seeking debt advice increased from 60% to 64% between 2021 and 2023.
- 88% of single parent households are headed by women.
- Average monthly surplus/deficit for women in 2023 was -£30, compared to £40 for men.
- Women spend 17% of their income on childcare costs, higher than men.
- 44% of women received Universal Credit in 2023, compared to 25% of men.
- Single women with children cited cost of living increases as a main debt reason at 33%.
Key Takeaways
- Economic challenges disproportionately affect women, particularly in the context of the recent pandemic and cost of living increases.
- Tailored financial support and policy reforms are crucial to address the specific needs of women, especially single mothers.
- Recognizing and addressing the intersectional factors that contribute to women’s financial vulnerability is vital.
- Policy discussions should focus on mitigating the impact of caregiving responsibilities and improving access to the labor market for women.
- A reevaluation of the benefits system, like Universal Credit, is needed to better support women facing financial difficulties.
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