Unsecured debt hits peak of £14,540 per household, says TUC

The trade union’s figures, based on data from the Office for National Statistics and the Bank of England, show that household debt rose sharply over 2019, with unsecured debt reaching record highs:

• Unsecured debt per household rose to £14,540 in the third quarter of 2019, which is up £430 on a year earlier
• Total unsecured debt rose to £407bn in the third quarter of 2019 – the first time it has gone over £400bn and well above the £286bn peak in 2008 ahead of the financial crisis
• Unsecured debt as a share of household income is now back to the same record high of 27.5% that it reached in 2008 at the outset of the financial crisis

The TUC attributed the debt levels to government austerity, the rise of insecure work and years of wage stagnation.

It argued real wages are on average lower today than before the financial crisis, pushing many working households towards borrowing.

TUC general secretary Frances O’Grady said: “It’s not about keeping up with the Joneses. This is hard-up families borrowing just to scrape by. It’s for paying the rent, heating the home and feeding the kids.

“The reason we’re seeing this is bad management of the economy. Wages are still worth less than a decade ago. Too many people have insecure jobs with uncertain hours. And vital support like working tax credits has been cut.

“No more excuses – the government must put together an urgent plan to improve living standards and to help families struggling with dangerous levels of debt.”

UK unsecured borrowing in total and per household, 1989-2019