Falling values of Statutory Sick Pay (SSP) and contractual sick pay are leaving millions of Brits exposed if they are unable to work due to illness or injury, finds Cirencester Friendly Society,the Income Protection specialist.
Since 2016, SSP has risen by just £25.14, from £383.28 to £408.42 per month, significantly trailing behind inflation and leaving the average worker with a shortfall of over £1,540 each month. This compares with a monthly shortfall of £1,164 in 2016, if employees were unable to work due to illness or injury and had to rely on State Benefits. This pay gap is compounded by reduced contractual sick pay which has fallen dramatically from an average of 15.7 weeks in 2016 to under 4.5 weeks this year.
What’s even more worrying is the drop in the average Briton’s savings. 25% of UK workers say they have no savings at all and this increases to nearly one-in-three (32%) among women. On average, Britons say their savings would last just nine weeks were they to stop working. This has fallen significantly from over thirteen weeks in 2016.
Despite this reduction in governmental and employer support and the drop in personal savings, only 17% of people have income protection to provide them with continuing income if they are unable to work due to illness or injury. These findings come from independent research of over 2,000 workers in the UK, aged between 18 and 54.
Commenting on the findings, David Macgregor, Commercial Director at Cirencester Friendly said:
“It is deeply concerning that so many people would face potential financial hardship if they had to stop work due to illness or injury, and with the growing difference between people’s actual earnings and SSP this looks to be a trend which will only worsen.
“When faced with household bills, potential medical costs and either mortgage or rent, the average person’s savings would be exhausted in just nine weeks. We hope our findings will serve as a reminder for people to take out income protection to provide them with continuing income and peace of mind, if they are ill or injured and unable to work.”