[ 2013-08-11 ]

15 ways the credit crunch has changed lives in UK
Six years ago today, the high summer of economic
prosperity ended with an horrific bang. On 9th
August 2007, BNP Paribas, the giant French
investment bank, stopped investors withdrawing
their money.

It was the start of the credit crunch and “the
day the world changed”, according to Adam
Applegarth, chief executive of Northern Rock,
which just a month later caused the first bank run
in Britain for 150 years.

We all know what happened next. The credit crunch
turned into a financial crisis, which morphed into
a deep and nasty recession. Businesses collapsed,
many of them well-loved favourites such as
Woolworths.

If you were lucky enough to keep your job, you
probably had to accept a pay freeze. Interest
rates were slashed, hitting savers and ushering in
an era of uncertainty and austerity.

But a series of reports this week suggests that
the economy is finally on the mend – and we’ve
a dynamic new Governor breathing life into the
Bank of England. It’s a timely moment to examine
the 15 most intriguing ways in which our lives
have altered since the darkest days.

1 The £10 Friday feast
The microwave had a good credit crunch. When
families cut back on the luxury of going out to
local restaurants at the weekend, canny
supermarkets stepped in to fill their place. Marks
& Spencer started a trend with it’s
dine-in-for-£10 deal, and others followed suit.
The up-market ready meal, complete with side dish
and bottle of wine – usually eaten while
watching a glitzy talent show – is now a staple
in millions of middle-class households on a Friday
or Saturday night.

2 Bricks and marriage – 23% fall in divorce
rate
The shape and make-up of our homes changed
irreversibly. The housing market collapse, which
caused misery for solicitors and estate agents,
meant that people simply stayed put.

Rather than paying stamp duty to move, home-owners
dug into their cellars and extended their lofts.
Houses became more crowded, with grown-up
children, unable to find a job, staying in the
nest. And many, who might have contemplated
splitting up, chose to stay together under the
same roof. Separation just became too expensive,
hence the 23 per cent fall in the divorce rate.

3 Sobriety
We didn’t drown our sorrows: the average British
alcohol consumption fell from the equivalent of
9.2 litres of pure alcohol during 2007 to less
than 8 litres last year. This was partly because
of increased prices, and the hike in VAT from 17.5
per cent to 20 per cent didn’t help.

Puritanism entered the workplace, too. Out went
the fruit-platters in boardrooms and free biscuits
in meetings. In came white shirts for men and tan
tights for women. Was the death of
dress-down-Friday the reason unemployment never
hit the much-feared three million? Quite possibly.
Though the rise in part‑time working is more
likely.

4 Clean air
One of the great unintended consequences of the
recession has been a victory for the Greens. We
stopped buying new cars, drove fewer miles in our
existing ones and hopped on to our bikes. And if a
factory slows down production, it belches out
fewer fumes and sends fewer lorries around the
country.

Government statistics suggest particle pollution
fell by 14 per cent in towns, while there are now
an extra one million people regularly cycling.
It’s hardly an environmental utopia, but it’s
a start.

5 Grow your own Tupperware
The Good Life returns: sales of veg seeds went up,
as we ripped out flower beds in favour of edible
crops. Organic food sales fell sharply, proving
that much of its success was down to a
middle-class fad. But buying and eating local
produce and growing-your-own rocketed. Beekeeping
became the rage, while some started to keep
chickens in town. How the urban foxes loved that.

The real legacy is the cachet now attached to
making your own sandwiches, as the boom in
lunch‑box sales testifies. Bringing in
home-cured bresaola on a home-baked slice of rye
bread, stored in a Lakeland storage box, is the
ultimate badge of honour.

6 Bad teeth
Dental hygiene was dealt a double-dip blow by the
credit crunch. Not only did consumers gorge
themselves on sweets and chocolate as a cheap
palliative for their woes, but they tried to save
money by cutting back on trips to the dentist,
fearful they would be landed with an unpayable
bill at the end.

The British Dental Association said it was forced
to deal with more emergency procedures as a
result. A set of braces used to be a key part of a
middle-class child’s uniform – but expensive
orthodontistry has almost disappeared.

7 Farewell to Bogofs in this new Aldi Albion
Saving money didn’t so much become a way of life
as part of the fabric of the nation. Vacant shops
were filled with pound shops or funny-sounding
supermarkets selling cut-price German ham. The
success of Lidl, Aldi and Poundland changed
supermarkets fundamentally. Value ranges became
huge business; Waitrose Essentials now turns over
more than £1 billion a year.

Wasteful buy-one-get-one-free offers (Bogofs) fell
out of favour. Instead, in came what is called
round-pound pricing (£2 rather than £1.99), as
people on a budget wanted to be able to calculate
the cost of their shop mentally by the time they
got to the till.

8 Wither the dessert trolley?
Those who still ate out did so on a budget. Hence
the confetti flurry of discount-vouchers in every
pizza joint.

Fine diners found ways of trimming their bills.
Puddings were the biggest victims and the wheels
of the sweet trolley rusted to a halt.

Research house NPD calculated that 96 million
fewer puddings were consumed on restaurant
premises last year. Farewell, jam roly-poly.

9 And now for a commercial break …
Under huge pressure from the broadcasters, who
were struggling to attract revenue, Ofcom, the
regulator, allowed channels to up the ads. In
dramas, the total length of adverts could rise
from seven minutes an hour to 12 minutes. Blame
the credit crunch for the fact that we seemed to
spend almost as long on a Viking River Cruise
during Downton as we did in Carson’s pantry.

10 A dog’s life
Pets got a bit of a raw deal. Many of us found
that the easiest way to cut costs was to let the
cat out of the flap, and never let it in again.
The RSPCA says that the numbers of dogs and cats
abandoned increased by 65 per cent since 2007.
Even retired racehorses were being sold for just a
few pounds by owners unwilling to pay for their
upkeep. I wonder how many ended up in our
burgers?

11 A Y-front shaped recession
Our wardrobes changed as we cut our coats to suit
our cloth. Pyjama sales went up because we spent
more evenings at home on the sofa – a trend that
also helped boost the racy lingerie business and
the far less sexy slanket and onesie industry.

Debenhams said that sales of men’s Y-fronts went
up by 35 per cent, while sales of baggy boxers
fell, claiming that during tough times men wanted
the “greater sense of security” that tight
pants offered.

12 Pop goes the bubble bath
Unilever, the consumer goods manufacturer whose
products are in 99.4 per cent of British homes,
revealed that shoppers were buying more shower gel
than bubble bath, as people cut back on
fripperies. The astronomical rise in heating and
hot water costs also played a part: more people
chose to scrub themselves clean under a shower.

13 We’re all going on a summer neologism
Are you going on a staycation? Are you off
glamping, setjetting or settling with a two-week
sofalize? The holiday industry experienced a
revolution, with the biggest casualty being the
English language, as we were persuaded that two
weeks in a damp campsite outside Great Yarmouth
was as glamorous as St Tropez.

The real sea change was the death of the
last-minute flight abroad. Families wanted the
certainty of a good time if they were spending
money on a break.

14 Goodbye, Mr Chips
Strangely, private education has survived. But
like other luxury goods – £1,000 handbags,
Knightsbridge penthouses, vintage wine – it has
kept its head above water because of the influx of
Russian and Chinese money into this country.


Numbers of British pupils have fallen, and nearly
40 members of the Independent Schools Council shut
up shop in the last three years.

15 Red lights turned off
Rising rents, falling demand from cash-strapped
consumers and higher competition from discount
operators and the internet – yes, the high
street has had a torrid few years.

And the oldest retail profession of them all has
been hit by identical pressures. According to a
recent report by Westminster Council, funded by
the Department of Health, prostitutes have been
forced to cut prices by 50 per cent. Sex sells,
just not as well during a recession.

Source - The Telegraph

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