Publications that covered this story include: The i
- Insolvencies amongst young women growing faster than any other category
The number of insolvencies amongst young women aged 18 - 24 jumped 24% last year, rising to 3,930 in 2018, up from 3,175 in 2017*, our research shows.
Insolvencies amongst young women are growing faster than any other demographic group. All individual insolvencies increased at a slower 17% over the same period, rising to 116,407, up from 99,157. Insolvencies amongst young men increased 15% last year, to 2,843 in 2018, up from 2,468 in 2017.
Our research shows that the rise in insolvencies amongst young women may have been driven by growing redundancies in the retail and hospitality sectors. ONS data shows 66% of jobs in the retail and hospitality industries are held by women, compared to just 34% held by men**. A number of restaurant and retail chains have had to go through redundancy rounds in the last year.
Increasing consumer debt
Some young people may also be struggling to control the amount of debt they are taking on from relatively new forms of “point of sale” credit. For example, easy to obtain credit offered by online retailers, via providers like Klarna, is increasingly popular.
Consumers overall have started to struggle to repay their debts; the value of consumer loans written off by UK banks hit £456m in 2018/19, the highest level since 2014/15***.
Peter Kubik, Turnaround and Recovery Partner in our London office, says: “Young women are being hit hard by the growing redundancies in the retail and hospitality sectors. If pressure on the high street continues then women are likely to continue to bear the lion’s share of the financial pain from that.”
Peter explains that personal insolvencies are normally caused by a combination of both a shock to income, such as unemployment and the build-up of excessive debts.
He adds: “Each new generation of consumers need to avoid falling for attractions of easy credit. Ten years ago, it was credit cards and sub-prime mortgages. This time around the new risks are point of sale credit, payroll lending and auto-loans.”
Number of insolvencies amongst young women aged 18-24 almost doubles in five years
