We spend well over a half a billion Euro a year on take away coffee and the market is growing. Sales in bars, seasonally adjusted, are up 8% in Q1 year on year. I'm just not buying the motion that there's a national cost of living crisis. It's certainly a crisis for some people, but not for the vast majority.
Are the "vast majority" of people the ones splurging on take away coffee and bars?
Such isolated figures cannot speak to the experience of the vast majority of the people, all it can establish is that there is a cohort with money to spend.
Regardless, it doesn't have to affect the vast majority or even the majority for it to be a crisis.
In the Irish Times article I linked from 2024 economist Austin Hughes used the phrase "a cost-of-living
shock".
Depending on how the strength of your financial position the impact of that shock is what turns it into a crisis.
The CSO’s household budget survey for 2022/23 shows that weekly spend by those in the top 20 per cent of households was four times that of those in the bottom 20 per cent (€1,757 v €444), suggesting “
altogether different capacities to cope with a cost-of-living shock,” Hughes says...
The average household has seen a drop in its disposable income, in real terms, of about 5 per cent...
Median annual earnings of employees increased a cumulative 6.5 per cent between 2020 and 2023 while the cumulative increase in consumer prices over the same period was 17.3 per cent.
Despite citing these figures, Hughes says there is a central problem in economics about using average or median figures. “The idea that there is a ‘representative’ Irish consumer whose experience is mirrored across all households is not challenged enough,” he says.
“If you’re on the minimum wage, your household spending is not the same as the average consumer. The amount you spend on food, heating, rent is altogether greater so your cost-of-living has increased more significantly,” he says.
Inflation has fallen back to target, but prices remain much higher than three years ago