Full-time workers spend 16 per cent of annual income on work costs
Commuting costs £1,087 average per year
Childcare costs as much as £3,910 per year
Cost of working up 6 per cent since 2014 and 20 per cent since 2013
Workers in the UK collectively spend £91 billion1 per year on costs they face specifically because of their job and these costs are rising, according to research2 from Santander Credit Cards.
Work-related expenses including childcare, commuting, work clothes and computer equipment cost the average full-time employee £3,405 per year, compared with £3,218 in the previous year3 and £2,681 in 20134 – up 6 per cent from 2014 and a 27 per cent increase since 2013.
The annual bill of £3,405 swallows up 16 per cent of full-time workers’ net income5, up from 15 per cent from the previous year and 12 per cent the year before.
Commuting is the most expensive part of being in employment, costing a full-time employee an average of £1,087 annually. To get to work by public transport, full-time employees have to pay an average of £1,357 a year, while motorists spend £1,238 a year getting to work, with £922 spent on fuel, £180 to park their car and £136 on tolls/congestion, up more than £50 since the previous year6.
Childcare is also a substantial cost, with the average outlay now £960, although this has not increased significantly since 2014. However, one in four people pay more than four times the average – as much as £3,910 a year.
Barry Naisbitt, Chief Economist at Santander UK commented: "With over 31 million people7 currently working in the UK, employees are of huge value to the economy. Not only is this from the output of the work they produce, but also due to the substantial additional contribution they make through work-related products and services, to the tune of £91 billion per year. From the money they spend on work clothes to the cost of childcare, employees re-invest a significant amount of the money they earn from work every month."
Santander Credit Cards surveyed workers to see how much they spend on all work-related products and services they can't claim back, and found the total amount spent has increased significantly over the past couple of years.
Average amount spent per year by full-time workers on work costs 2013 – 2015*
|Spend per year by the average full-time worker||20152||20143||20134|
|Commuting (all modes of transport)||£1,087||£1,095||£911|
|Childcare (among all workers)||£960||£943||£691|
|Food and drink||£553||£509||£504|
|Personal grooming (spent only because of work)||£228||£186||£180|
|Money spent on colleagues and clients||£140||£118||£84|
|Work equipment such as stationary||£38||£32||£20|
|TOTAL PER YEAR||£3,405||£3,218||£2,681|
Source: Santander Credit Cards
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Notes to Editors
(1) Respondents were asked to estimate their annual and monthly spend on a variety of work related expenses including transport. These averages were calculated to be applicable to the whole working population. Total average annual spend on all work costs is £3,028.04 for all workers. This is applicable to 60% of the population, which based on ONS population estimates equates to 30,101,891 people. £3,028.04 *30,101,891 equals £91,149,611,901.
(2) Research commissioned by Santander and conducted by Opinium Research 12th – 19th June 2015. Sample size 2,000+ UK adults.
(3) Research commissioned by Santander and conducted by Opinium Research 19th – 22nd August 2014. Sample size 2,000+ UK adults.
(4) Research commissioned by Santander and conducted by Opinium Research 6th-9th September 2013. Sample size 2,000+ UK adults.
(*) Figures have been rounded up.
(5) ASHE, ONS median gross earnings for full-time employees is £27,195 before tax. Post-tax is £21,579.80 (calculated on www.thesalarycalculator.co.uk). Full time UK workers spend £3,405 per year. £3,405 is 16% of £21,579.80 (http://www.ons.gov.uk/ons/rel/ashe/annual-survey-of-hours-and-earnings/2014-provisional-results/2014-provisional-table-1.zip).
(6) 52 weeks per year with 5 working days for a full time worker gives 260 days. The average person takes 4 weeks holiday each year (20 days) and 8 bank holidays so has 232 working days each year. 232 working days * average of 13.1 miles per working day for those who drive to work = 3,047 miles per year.
(7) According to the latest UK Labour Market figures there are were 31.42 million people in work between October and December 2015. These are the latest figures available.
Santander UK is a financial services provider in the UK that offers a wide range of personal and commercial financial products and services. It has brought real competition to the UK, through its 1|2|3 products for retail customers and relationship banking model for UK SMEs. As at 31 December 2015, Santander UK was one of the most switched to banks. The bank serves more than 14 million active customers with c. 20,000 employees and operates through 857 branches and 70 regional Corporate Business Centres. Santander UK is subject to the full supervision of the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) in the UK. Santander UK plc customers are protected by the Financial Services Compensation Scheme (FSCS) in the UK.
Banco Santander (SAN.MC, STD.N, BNC.LN) is a leading retail and commercial bank, based in Spain, with a meaningful market share in 10 core countries in Europe and the Americas. Santander is the largest bank in the euro zone by market capitalization and among the top banks on a global basis. Founded in 1857, Santander had EUR 1.51 trillion in managed funds, 13,000 branches and 194,000 employees at the close of 2015. In 2015, Santander made attributable profit of EUR 5,966 million, a 3% increase with respect to the previous year.
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