More residents are spending less as economy concerns grow
More than half of residents are spending less and going without basics amid fears of a shrinking economy and rising inflation, according to a survey.
A similar number are also worried that they will not have sufficient savings to be able to retire.
The online survey of 382 adults, conducted by Narrative Research Bermuda, revealed that 56 per cent of residents were going without and buying less – up from 34 per cent in the last quarter.
And in a drive to cut household costs, residents are finding other ways to tighten their belts. More than 40 per cent said they are buying local where possible, 28 per cent are buying in bulk, and 20 per cent are growing their own food.
A further 18 per cent are buying items second-hand or trading with others.
According to Narrative Research Bermuda, lower and middle-income earners were more likely to have bought less.
The research company added: “With inflation surging and interest rates on the rise, residents in Bermuda are increasingly pessimistic about the Island’s economy, becoming more wary about their ability to afford goods and services.
“Given rising inflation, increased interest rates, and lingering effects from supply chain issues, Bermudians are growing increasingly wary about the island’s economy, including the cost of living and their purchasing power.”
The survey showed that 54 per cent of residents were concerned about their ability to save for their retirement.
Other concerns centred on health issues, with 49 per cent of participants claiming to be worried about their ability to buy healthy food, and 39 per cent anxious about the cost of health insurance.
Only 12 per cent of recipients said they had no financial concerns.
The latest results show a growing concern among residents over the personal finances and the economy.
In a similar survey conducted by Narrative Research Bermuda in March, only one in three residents said they were being forced to cut back on basic foodstuffs as a result of rising costs.
Also in that survey, 17 per cent of participants said their spending habits had not changed. That number has now dropped to 11 per cent.
According to latest figures, inflation now stands at 3.7 per cent – the highest rate since 2007. But critics claim that the figure does not reflect the real rate of inflation, which they say is much higher.
The Government has introduced several measures to ease the financial burden on households in recent months. Gas prices at the pump have been frozen since March and there has also been a reduction in annual vehicle licensing fees.
Lower-income earners have been granted a payroll tax rebate and last month legislation was passed to grant seniors a 2.5 per cent increase in their pension, backdated to August 2021.
Other measures include a $150 voucher for parents of public school pupils to buy school supplies and an increase in the food allowance for people on financial assistance.
And $500,000 has been set aside to provide LED light bulbs to help cut electricity bills.
Speaking in the House of Assembly last month, David Burt, the Premier and finance minister, said: “Those who earn more can afford to pay more. It is very challenging to make ends meet if you earn less than $60,000 in Bermuda, therefore we want to do as much as we can to provide assistance where it is most needed.”
Last night Mr Burt, said: “We’ve gone through hard times these past few years with the worst pandemic in 100 years, inflation in the USA and the war in Ukraine all leading to increases in the cost of living.
“We have led our country through it all, supporting small businesses and providing economic relief to people who lost their jobs, reopening the economy, and growing a new pillar in international business. Now, we must persevere once again in the face of another challenge.
“In July, we passed the economic relief package, which helps parents of Bermudian public school students with $150 grants for school supplies, distribution of free energy-efficient light bulbs, a payroll tax rebate of $250 for Bermudians earning less than $60,000 and $100 for Bermudians earning between $60,000 and $96,000 and a 15 per cent increase in the food allowance budget at Financial Assistance to help families in need.
“We have also extended duty relief on the importation of fuel to control petrol price increases.
“We’ve been through tough times, and we’ve come through. Now, we face a new challenge, and we must remain resilient and we will overcome this challenge together.”