The French are not all in the same boat with rising prices. If this is not a surprise, it is one of the main lessons quantified by the National Institute of Statistics and Economic Studies in its latest economic report released today. Thus, at the beginning of the year, inflation differentials between households are accentuated by the sharp rise in food and energy prices.
Last June, INSEE had already highlighted these disparities in inflation between households, which could reach 1.5 points in April compared to an average of only 0.2 points between 2015 and 2021. In January 2023, these differences between the youngest and oldest households or between rural and urban households exceed 2 points, driven by energy elements but now also by food.
The 40% of households with the lowest standard of living are most affected
In the first month of the year, inflation was 1.2 points higher for households whose reference person is over 75 years of age, while it was 1.3 points lower for households whose reference person is over 30 years of age. “Being a renter (which is more common in young households) probably reduces overall inflation today, because the weight of rent in the budget mechanically reduces the share of other items, including food and housing.” energy in particular, which are showing strong price increases”, analyzes INSEE.
Likewise, the price increase was almost one point lower for households in the Paris area and about 0.8 points higher for those living in rural areas. Finally, the standard of living also plays a role, since the 40% of households with the lowest standard of living endure higher inflation than the richest.
Older homes are victims of the increase in gas and fuel oil
The weight of energy expenditure in the home increases with age. These weigh only 3% of all the spending of households under 30 years of age when this proportion doubles for those between 60 and 74 years of age and even reaches 9% for those over 75 years of age. “This is probably partly explained by homes whose surfaces are larger, on average, for older households, even with an equivalent household size,” explains INSEE.
Added to these disparities are those relating to the type of energy. Older households consume more gas and other fuels such as fuel oil, whose prices have skyrocketed in the last year, while younger households prefer electricity, whose price increase has been less. The item dedicated to fuel helps to slightly reduce the generation gap, since those under 30 spend a slightly higher part of their budget on it than those over 75, around 2% compared to 3%.
These differences are also observed between households in small towns and those in large cities. Home energy expenditure represents just 3% of the budget for households in the Paris conurbation, compared to 7% for households in rural areas, which also favor fuel oil and other fuels over electricity. Similarly, households in small towns and rural areas spend a larger share on fuel than those living in large cities or in the Paris metropolitan area (between 2 and 3% of the budget compared to 4 or 5%) where “the vehicle is probably mobilized less frequently”.
The diet of the oldest and most modest includes inflationary products
In this period of rise in the shelves of large retailers, the generation gaps in inflation are also logically related to the food item. Here too, the proportion of food varies from one budget to another: it is 11% for those under 30 and almost double for those over 60 (21%). “For the youngest, on the other hand, the weight of catering services is greater, less affected by inflation,” emphasizes INSEE. As if that were not enough, older households buy more protein products of animal origin such as meat, fish, eggs and dairy products, which have seen a more pronounced increase in their prices than the average for the last year.
The logic is more or less the same between the most modest households and the most affluent. Food represents only 14% of the budget of the 20% of the richest households compared to almost 19% of the 40% of the poorest households. The latter’s food basket includes more oils and other fatty products “whose prices are among the most dynamic (+20% approximately over a year in January 2023)”.
Source: BFM TV
