To think a recession is looming?

[GrannyBloomers]

I was quoted £2 a litre for heating oil. £1000 for 500 litres, a matter of weeks ago it was roughly a quarter of the price.

Energy bills set to be £3k per annum - potentially more when a new price cap comes in in October.

Diesel near me is 171p and rising.

I'm in a 3 bed semi, nothing special. I need at least 1500 litres of oil a year (it runs the hot water too). That's say £3k. No gas but electric. I'm doing ok with cutting use = £1.5k per annum.

That's 4.5k at todays prices for household power. What will it be in October - 6k, 9k more?

This is before other costs increase - food will go up when the cost of storing it (refridgeration etc uses energy) and transport also increase.

If all the average person's income is spent on rent/mortgage/ bills and energy, then there's no money to spend on anything else. No eating out, no leisure, no holidays.

Surely a huge recession will follow.

And what if a much higher proportion of people need benefits?

This is worrying me. We aren't high income at all (I think they will have to "cut back" but be fine) and am genuinely quite worried. I think if fuel and food go up that will be enough to make things tricky for us. But obviously there is all the knock on effects too.

I don't really understand the economics of recession, but we "got through" the brexit price rises, then struggled through covid (but at least noone was going on holiday/eating out at times then) it will soon be a big rich/poor divide with those who can and those who can't. Sadly we will be struggling.

There is currently a very severe risk of a recession. Energy prices being consistently a high and a higher % of GDP is increasing the risk.

Yes, all extra money is now being spent on necessities.

Less consumer spending, economy contracts

I am concerned too. We live rurally so have no mains gas and no public transport. I have all the radiator thermostats and the timer set for what I would call a level of warmth in the house. I try to do a number of tasks, errands, shopping etc in one trip rather than over a number of days. There is very little I can do to lessen our usage of either diesel or heating oil to overcome the current increase.
We will manage, our house will be cooler and we will cover less mileage but I feel for our fellow villagers. The minimum amount of oil a company will deliver is 500litres which is currently £1000 or thereabouts when I was quoted last night. The quote was valid for 30 minutes!

Of coarse a recession is coming round, no one will have any spare money to do anything with. You go to work to earn money just to go to work again, it’s going to get very very nasty.

There's been less consumer spending on non-essentials since early January, probably since as early as last October.

My income has dried up. It's scary just how rapid my income has declined and how I've gone from working 10 hours a day 7 days a week, to barely working 10 hours in a week. I'm really worried for my business at the moment. I'm going to keep going (luckily I can as I work from home, but my competitors have high overheads, employees, rented units/workshops etc), but I imagine I will have to return to some form of paid employment soon 😥

Yes a recession is looming. Someone had their arse handed to them on a plate a few weeks ago because they wanted to talk about cutting out luxuries. It descended in to a sort of four Yorkshiremen sketch and they were berated for daring to complain because they could still heat and eat. But it’s incredibly valid, no spare money for Lunch out, an evening at the pub, a theme park, new clothes just for fun. That’s jobs at risk.

I bought a long term desired but non necessary item last year from a small business made entirely in the UK. It was expensive, traders like , that will suffer hugely.

Absolutely guaranteed!

House prices are still going through the roof too.

Something will have to give, but I hope we'll avoid a full recession.

Yes, I think so. I don't see how it could be otherwise, all things considered.

DH has a company car and they pay for the fuel for him to commute. That’s about to get a lot more valuable! We’ve turned the heating down and cut non-essential spending. No more eating out, less takeaways, no cinema or theatre, less days out, cancelled the gym membership and kids swimming lessons, no new clothes. We could afford to still have some of those things but the fact is, we need to save because we don’t know how bad this is going to get. We need a cash buffer in case the shit hits the fan.

I'm self-employed and have also noticed a tail-off in enquiries. January is always quiet with February not much better, but the calls usually start rolling in once we've had a few good Spring days (and people have been paid at the end of Feb). The phone is worryingly quiet. Even the run up to Xmas was quieter than normal. I was fully booked, but I didn't have my last slot taken until the end of October. In a normal year, if you aren't booked by September you've missed the boat, and I will usually also be turning clients away who are desperate for a pre-Xmas slot (obviously I'm happy to do the work in the NY, but this often doesn't suit them).
Both DH and I are in construction, and the industry is usually hit first and hard in a recession. We are bracing ourselves. DH is desperate to move jobs, but will stay put for now so that if it does come to pass and he is made redundant, at least he will get something.

A@SkankingMopoke
You say you are in construction can I ask what you do and where you are based?
You can’t get anyone to do anything on your house for love or money where I live, a fairly ordinary Midlands city.

Very scary times at the minute.
I've been wondering whether people will stop using their cars so much and move to other modes of transport - cycling, walking, buses etc.
I cycle to work and traffic is horrendous where I live in Bristol. I appreciate that some people aren't able to walk or cycle, either due to mobility/kids/long commutes etc. But I suspect that as fuel prices continue to rise, a lot of people might start exploring alternative transport which could only be a good thing?

I think we will enter a period of stagflation and recession.

I was looking to drop from FT to PT shortly as I have small children. I’m going to be hit with two sets of nursery fees until my eldest goes to school in September and then won’t get any funded hours until September 2023 so the next 18 months we’re going to be tight anyway before the massive gas/elec increases and fuel increases. My London based employer now wants everyone back in the office 3 days a week. Which is fine if you live in London as there is lots of public transport. Everyone based in the regional offices like me just has to suck up the fuel costs. So that will be £90 per week on petrol now and rising.

I’m really worried about it all. We’re trying to replenish our savings after my maternity leave at the moment but just can’t because of the cost of living. I feel physically sick at the thought of money.

Add interest rate rises and a corresponding house price crash.

I think we are in for hard times.

@ThatsGoingToHurt

I think we will enter a period of stagflation and recession.

I was looking to drop from FT to PT shortly as I have small children. I’m going to be hit with two sets of nursery fees until my eldest goes to school in September and then won’t get any funded hours until September 2023 so the next 18 months we’re going to be tight anyway before the massive gas/elec increases and fuel increases. My London based employer now wants everyone back in the office 3 days a week. Which is fine if you live in London as there is lots of public transport. Everyone based in the regional offices like me just has to suck up the fuel costs. So that will be £90 per week on petrol now and rising.

I guess you've already thought of this, but any chance of explaining this to your employer and telling them just how much this fuel will cost you? If they're used to taking public transport, they may genuinely not have thought of what this means for those in regional offices.

(Apart from the presenteeism issue, if they just want bums on office seats to prove you're working, why won't the regional office do?)

I've never been in a worse financial position in my life. I am far far worse off than I was in the last recession - and I've been made redundant twice since then.

[quote Fairyliz]A@SkankingMopoke
You say you are in construction can I ask what you do and where you are based?
You can’t get anyone to do anything on your house for love or money where I live, a fairly ordinary Midlands city.[/quote]
Bedfordshire. I have a trade, but DH is white collar and works for a large house builder.
I good number of tradespeople I know are beginning to notice it here. We all still have work, but we're only booked eg 4 or 6 weeks ahead rather than 12+, and you can't be quite as choosey. If it stays like this it'll be OK, but if it carries on along this trajectory of dropping it is a huge worry.

@Lockheart

House prices are still going through the roof too.

Something will have to give, but I hope we'll avoid a full recession.

Well the rigged housing market will be one of the things that has to give surely? People can't play that silly game when they're worried about food and fuel

Absolutely. We have an online shop selling non-essential goods. Sales have never been so low so people are already cutting back spending.

I'm no economist so I'm happy to be corrected on this, but don't crazy house prices usually precede a recession? There's only so long that can be sustained.

I'm surprised that the recession has held off so far.
It will only take mortgage interest rates to move a couple of notches in my view. Been through it before and it's grim.
Inflation is high, interest rates follow.

Yes, recession. Everything will go up because of fuel prices, partly because of transport costs. Add to that reduced food availability because of lack of wheat and fertilisers, it's going to be bleak for a while.

But house prices aren't going to crash, unfortunately, because of the international investor market. Domestic buyers won't be able to afford them, but real estate is seen as a 'safe place' to put your money when stock markets are volatile. Which will keep the prices artificially high