Could the cost-of-living crisis be even bigger than we thought? See for yourself

The cost-of-living crisis is hardly news at this point. It continues apace, its effects are well established and, even if inflation slows down significantly, price rises that went into outer space will linger for years.

But could the impact on households actually be worse than we thought? That depends on your circumstances.

Headline inflationary figures are broad estimates. Inflation for different things – gas, petrol, individual items of food – will all be different and the cost-of-living increase experienced by a given household will depend on exactly what they buy.

Wages have been stagnant for a decade or more so, in real-terms, the nation has been taking pay cut after pay cut for a long time. What was a slow squeeze became an immense crush over the past couple of years. Inflation was over 10% for month after month.

That certainly sounds scary but if this was driven by monstrous rises in the price of luxury goods, that would be a lot less worrying than if yachts and Range Rovers were all going down in price while the costs of basic foods were headed for the stars.

Individual people, households and families can only really measure how price surges are affecting them by tracking the price of the goods they buy.

The Office of National Statistics (ONS) has recognised this and today released an analysis of the different price rises of groceries.

Up and up

According to the ONS, grocery prices on the whole rose by almost one fifth (19%) over the calendar year up to March.

However, in that time 60 different types of item saw price rises above 20%, including five that rose by 40% or more.

Those big rises included a 49% hike in the price of olive oil, a 30% increase in the price of butter, a 44% rise for hard cheese and a 42% uplift in the price of cheddar (which is categorised separately from hard cheese). Dairy, in general, has become a lot more expensive.

“The milk, cheese and eggs products category has recorded one of the highest annual inflation rates in groceries throughout the last year. The latest official figures show a 30% increase in the 12 months to March 2023, slightly down from 31% in February.”

The analysis is not limited to food. It also looks at basic medicines, and some clothes. Cold and flu sachets have increased in price by around 24%, private dentist check-ups by about 7%, and nursing home costs by 10%.

However, the focus is largely on food, including assessments for some family meals:

“A roast dinner for four people, including a whole chicken (1.5 kilograms (kg)), white potatoes (1kg), carrots (1 kg), broccoli (350 grams (g)) and butter (100g), could cost £8.68 on average in March 2023, based on a 2023 sample. This is £1.68 more than in March 2022, with broccoli recording the highest increase at 34%.”

There are also inflationary estimates for delivery meals like fish and chips, or pizza – and the price of drinks in pubs.

Some people like to roll their eyes about the inclusion of non-essentials like takeaways and alcohol. However, people are allowed a life. We live in a wealthy country. No-one should be reduced to a diet of porridge and past-their-sell-by oranges.

If the just-tighten-your-belts crowd are reduced to saying that struggling families simply should never order a bag of chips or go out for a glass of wine, that says more about their attitude to other people than it does about the economy.

As well as this new, in-depth analysis of inflation, there is now a new method for looking at how the cost-of-living crisis is affecting your own household. It covers food and other groceries, of course, but its reach also goes much further.

Tool

The ONS has also launched a new shopping prices comparison tool, which allows people to track inflation on hundreds of different items.

The tool allows cost comparisons of groceries, clothing and footwear, health items (including medicines like paracetamol, grooming items like shampoo and mouthwash, and glasses and contact lenses), various recreational and cultural things (ranging from books to cinema popcorn, from a soft play session to booster injections for dogs), household items, different services and transport options.

If you want to see how inflation is affecting you, go here and tick on all the things you purchase. The tool is easy to use and largely self-explanatory.

It could (and should) be important for third-sector organisations. They will be able to easily keep track of price rises that are relevant to their service users – which will be useful both for keeping tabs on any growing pressure on service users, and for lobbying and other campaigning on those service users’ behalf.

For instance, with just a couple of taps on a keyboard, parenting and early years organisations will be able to track price changes in baby formula, babygrows and sleepsuits (yes, the tool is that specific), books for under 5s, childminding costs, and more.

Of course, none of this will actually bring inflation down at all. Not directly, at least.

The way we talk about the economy is changing. Back when wage growth (and growth, per se) were reasonably robust and the socioeconomic prospects of people were generally on the up, reducing everything to GDP was vaguely acceptable.

Nowadays, with growth questionable, wealth inequality running rampant, and with inflation outstripping rises in household income seemingly as a matter of course, the economy needs to be discussed in much broader terms.

This ONS tool could democratise that. And, in doing so, could equip individual people and campaigning organisations with easily-accessible knowledge that will allow them to be a vocal part of economic discourse and, hopefully, to have a real say in the future of society.

Exactly how big is the cost-of-living crisis? Well, it’s big – but at least you can now measure exactly how big it is for you personally.