The folks living with no safety net
Yesterday the Central Bank published its report on the last quarter of 2011 which showed that 1 in 7 mortgages are now in arrears. In real numbers that means that over 70,000 mortgages are in arrears of 90 days or over, and frighteningly that number is up 42% since March 2010.
But this only tips the iceberg of the vulnerable households, if you look at mortgages in arrears of 60 days or more, 1 in 5 mortgages owners are behind in their payment schedule. And if you look beyond that again, there are now 400,000 people behind with their utility payments (who have probably been advised to pay their mortgages first).
Given that there are about 1.6m households in the State, this puts 25% of homes in some sort of financial difficulty.
Much as been written in the last couple of weeks, in particular in The Irish Time’s excellent series, about the ‘Squeeze Middled’ in our society. And this is the group that is more likely to fall into the financial pitfalls mentioned above. They are most likely to be in their 30’s and early 40’s, with young families, interesting many still have jobs (but are trying to get by on incomes that have been cut by 20% or more).
And this ‘New Poor’ group tend not to know what they might be entitled to, how to go about seeking State support, and if they do look for help will typically find that their employment/income/assets (the heavily mortgaged home) put them over thresholds for any benefits or allowances.
The Celtic Tiger years meant (I am reverting to a past popular model – good old Maslow’s Hierarchy of Needs) that many Irish people presumed the first layers of need as a given and were all about achieving self-actualisation. Today unfortunately we find that many of the people we are targeting with our goods and services are in fact focused back on their more basic needs, and brands that can offer them a parachute at any level (from value for money, meeting a real consumer need, or providing them with those moments of self-actualisation that were once more common) are likely to be the ones to succeed.