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Discretionary spending at risk as people prepare to cut back on clothing, eating out and holidays in response to cost of living pressures

Research reveals a “squeezed middle” with the 45-54 age group more downbeat than other age groups

PTSB’s latest Reflecting Ireland report is showing a more positive public mood than this time last year, with the number of people expecting a recession falling sharply from 67% to 46%.

The bank’s quarterly research of consumer behaviour and attitudes has also revealed a fall-off in people expecting the economy to get worse over the coming year, with 47% saying it now versus 63% a year earlier. 48% say the economy will improve or stay the same, up from 32% a year ago.

However, the number of people who say they are worse off than a year ago remains high despite a reduction year-on-year (54% now versus 63% a year ago).

Many consumers planning to cut back

This year, more consumers than last year are planning to cut back both on essential items and on discretionary spending in response to cost of living pressures. The percentage of people planning to cut back on essential items has risen from 66% to 71%.

People in the 45-54 age group are most likely to cut back, according to the research.

  • 60% of people say they will curb their energy usage
  • 53% will cut back on their grocery spend
  • 68% will spend less on buying clothes
  • 62% will eat out less often
  • 1 in 2 will cut back on domestic and foreign holidays and weekend breaks

“Squeezed Middle”

The 45-54 age group are the most likely to feel worse off than last year, according to the research, with 63% of this cohort saying they feel worse off versus a national average of 54% across all age groups.

48% of the 45-54 age group expects their financial position to deteriorate further, which is significantly higher than the 37% average across all respondents.

This age group also shows higher levels of worry over their day-today finances, with 57% less confident in their ability to manage their finances compared to 45% across all age groups. They are also the lowest cohort to report having money left over at the end of the month (35% for this group versus 42% average across all age groups).  

The so-called “Squeezed Middle” is also more likely to cut back on essentials and discretionary spending and the least likely group to plan on investing in retrofitting (12% of this age group versus 18% average across all age groups) or in buying a new hybrid or electric vehicle (11% versus 17% national average).


71% expect to be able to save regularly or when there is money to spare in 2024, with those aged 25 – 34 most likely to save (84% versus a national average of 71%).

The main motivation for savings is for a “rainy day” (approx. 50%), with saving for a holiday next at 39% and home improvements 29%.

Other findings

The research also revealed strong levels of support endorsing Ireland as a good place to grow up in, with 72% of people agreeing, but there was a fall in support for the view that Ireland is a good place to grow old in, with 56% of people backing this statement, down from 61% last year.

Respondents identified a number of positive features of living in Ireland, with 50% saying the natural environment was one of the 5 best things about living here, followed by our welcoming nature (47%), cultural strengths (37%), community values (34%) and sporting heritage (26%) completing the top 5.

73% of people said climate change is an issue that will be personally important to them in 2024, while 57% say they plan to do more to reduce their carbon footprint this year.

Leontia Fannin, PTSB Head of Corporate Affairs and Communications, said:

“Our findings as we enter 2024 show a welcome improvement in general public sentiment towards the economy but it’s clear that the so-called “Squeezed Middle” 45-54 age group is bucking the positive trend somewhat.

It’s also clear that negative sentiment remains at high levels despite the more favourable pattern. This in turn appears to be driving a willingness to cut back on spending – both on essentials and non-essentials – as people struggle to get to grips with higher living costs.”

Claire Cogan, behavioural scientist at BehaviourWise, said:

“It is heartening to see that despite current challenges, almost three quarters of us feel Ireland is a good place to grow up. It’s also interesting to note that those most likely to agree with this are aged 55 and over. This age group is also most likely to agree Ireland is a good place to grow old. In short, those aged 55+ most appreciate Ireland as a place to grow up and grow old”.

Read the full Reflecting Ireland report here.

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