SELPE: Decrease in income by 17% due to increases in energy costs

The Business & Retail Association of Greece has completed the 6th study of recording consumer trends in retail trade through a six-month retail consumer climate survey which it has been carrying out since October 2019.

The research was implemented with the scientific support of the ELTRUN laboratory of the Athens University of Economics and took place in the period 19-21 June 2022 through a Panhellenic Survey on a sample of 900 consumers. Particularly interesting conclusions and trends are recorded in relation to the purchasing habits of the public, the effect of energy cost increases and the pandemic.

First, as shown in figure 1 which records the factors by which consumers choose to buy products, the percentage of consumers who buy products with the main criterion of monetary expenditure increased from 46% last year at the same time to 74% in 2022 with all the remaining criteria to register a decrease. This result shows on the one hand the decrease in disposable income of consumers and on the other hand that the public’s concern regarding price increases has increased significantly.

Specifically, in terms of disposable income, consumers estimate that increases in energy costs reduce their disposable income by an average of 17%, with 2 in 3 consumers (66%) stating that their disposable income decreases by more than 20% .

Appreciation-price increases are also the main concern of consumers today. As shown in figure 3 at a rate of 73%. This percentage is significantly higher than the corresponding percentages recorded in Western Europe. Only in the United Kingdom is a relatively equally high figure of 60% recorded. The second main concern of consumers is Greek-Turkish relations with a rate of 11%, followed by unemployment with 7%. The war in Ukraine which is the second biggest concern in Western Europe with percentages ranging from 15% to 34%, in Greece it has only 2%. Of course, it must be noted that basically the main source of price appreciation today is due to the invasion of Ukraine and the Energy crisis, therefore in the countries of Western Europe the cause is recorded more strongly, while in Greece the result.

Finally, the assessments of consumers in relation to the summer holidays are recorded. As can be seen in figure 4, the majority of the public, 48%, declares that they will not take a vacation this summer. 22% say they will, but to a lesser extent, and only 13% say they will do the same as every year.

As for the amount of estimated vacation spending in 2022, it is estimated on average to decrease by 17%, with a majority of 35% stating that they will reduce their spending by more than 35%.

In relation to the factors affecting this year’s holidays, as recorded in figure 5, overall the reduced disposable income plays the biggest role, for 63% the reduction in income due to product price increases and for 50% the reduction in income due to energy costs . The increased cost of transportation with 52% is also a very important factor and for 23% the cost of accommodation. Concern over the COVID-19 pandemic or Greek-Turkish relations does not seem to play a role.

The results of the survey record the significant change that has occurred in the consumer public in the last year and the great impact of inflationary pressures on disposable income and by extension on the retail market in Greece.