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Freelancers to enter survival mode if Bank of England raises interest rates again

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Freelancers are going to have to work more or smarter or both to keep the lights on

A Bank of England rate-setter, a Goldman Sachs strategist and an analyst from the Centre for Economics and Business Research walk into a bar. What do they all have in common?

They are all preparing us for the Bank of England’s decision to raise interest rates. Mark your calendars for 22 June. That’s when The Bank will reveal the next base rate decision.

What does this mean for freelancers? Especially, those refinancing their mortgage this year? Coming up with thousands of pounds in extra salary/earnings, in some cases as much as £7300 for those paying London house prices.

That means many freelancers are going to have to work more or smarter or both to keep the lights on.

Most employees and freelancers work five days a week on average with a similar number of contracted hours, however, freelancers are more likely to work overtime than employees and be out of pocket during the cost of living crisis, as previously reported by The Freelance Informer.

We’re not all not doing fine

But some people think we are all doing just fine in this cost of living crisis.

Catherine Mann, an economist who sits on the Bank’s monetary policy committee, said that households had been “very resilient” in the face of inflation so far.

The rest of the world doesn’t see it that way. Britain is no longer mighty. It has the highest inflation of any “rich” nation, according to reports. That’s why Britain’s public should brace for interest rates to reach levels not seen since the financial crisis in 2007, suggests a City A.M. report.

So, why is it that the Bank of England is contemplating yet another interest rate rise?

It seems regular pay, excluding bonuses, increased by 7.2% in the three months to April. So, surely we must be all quids in and not struggling?

Wrong, those wage increases are still behind inflation.

Yet, the Bank of England has warned big pay rises are contributing to the UK’s still-high rates of inflation. But who the heck is getting these “big” pay rises? And were they long overdue? Were they to help employees make ends meet? To entice people into employment?

If Mann and others on the committee want to avoid a repeat of the housing crash of the 2007/08 financial crisis, they must seriously consider not raising interest rates again. Even Mann said in the City A.M. report, rightly so, there are “concerns about what’s going to happen to households with a mortgage.”

That’s 38% of Britain’s households.

Inflation has to be examined in a new light this time. Demand for everyday products has not grown exponentially, and neither have our wages, the supply chain problems are growing and causing inflation. The British public should not be the fall guy because of it.

Rant over, now…

In other questionable policies in England…

Commenting on the government’s decision to continue pursuing its ban on supermarket ‘buy one get one free’ offers, Head of Lifestyle Economics at the free market think tank the Institute of Economics Affairs, Christopher Snowdon, said:

“The government’s own impact assessment predicts that banning these deals will reduce calorie consumption by the equivalent of one grape a day.

“When Public Health England looked at it in 2015, they concluded that it could cost households £634 a year and that consumers use these offers as a ‘coping mechanism’ during periods of high inflation. Repealing this policy at a time when food inflation is nearly 20 per cent has to be the biggest no-brainer in British politics today.”

Cost of living crisis: it’s impacting how freelancers now work – Freelance Informer

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