One in four Brits have no personal savings, while 11% of workers could not cover their essential living costs at all without an income, new research reveals
British workers are in a dangerous financial position, as new research has revealed many don’t have savings or a money safety net to cover them if they were forced to stop work.
A study of 2,000 UK adults on behalf of national law firm Simpson Millar found 46% of workers would only be able to cover essentials for four weeks or less without an income, if an accident or injury left them unable to work.
More than one in 10 (11%) said they would not be able to cover their essential living costs at all, while just one in 10 (10%) could manage for more than three months.
The findings come as more than a quarter (26%) of UK adults say they currently have no money in personal savings.
Women appear particularly vulnerable to a sudden loss of income. Almost one in six (16%) working women said they could not cover their essential living costs at all if an injury stopped them working, compared with 6% of men.
Almost a third (31%) of women also said they currently have no personal savings, compared with 22% of men.
Younger workers are the least financially prepared for a loss of incom. Six in 10 (60%) 18 to 24 year olds said they could cover their essential costs for no more than four weeks, compared with 31% of workers aged 55 and over.
However, those aged 45 to 54 were the most likely to say they could not cover their essential living costs at all, at 16%.
More than half of workers in the West Midlands (55%), South West (54%) and Wales (53%) said they could cover their essential costs for no more than four weeks.
Workers in the East of England were the most likely to say they could not cover their costs at all without an income, at 14%, followed by the South East and Yorkshire and the Humber, both at 13%.
For those who have already experienced an injury or accident, the financial impact can be significant. Among people who had experienced an injury affecting their ability to work, a road traffic incident or an accident in a public place, 42% said they had been left financially worse off.
This rose to half (50%) in the South West and 49% in the North West. At city level, 55% of people in Plymouth who had experienced an injury or accident said they were left worse off financially, followed by 51% in Manchester.
Faced with unexpected costs following an injury, half (50%) said they would cut back on social activities and almost four in 10 (39%) would spend less on food shopping.
Women were particularly likely to say they would cut their grocery spending, at 43% compared with 34% of men.
Susan Vanden, Partner in the Personal Injury team at Simpson Millar, said: “An injury can take someone out of work overnight, but the bills don’t stop at the same time.
“For a lot of people, there simply isn’t a big financial cushion there. A few weeks without their usual income could be enough to put real pressure on household finances, and especially when everyday costs still need to be covered.
“We know that financial pressure can have a knock-on effect on recovery too. If someone is worried about paying their mortgage, rent or food bill, it’s understandable that getting back to work and earning again can quickly become their priority, even when they aren’t fully recovered.
“Where an accident or injury wasn’t your fault and was caused by someone else’s negligence, you may be able to make a personal injury claim. Compensation isn’t just about the injury itself. It can also cover loss of earnings and help meet the costs of treatment and rehabilitation.”
