Communications eating up more of budgets

Christos R., an employee in a shipping firm, has one of the latest models in mobile phones, a Bluetooth, and has recently acquired an iPOD to listen to his favorite music. Now he is saving up to buy an expensive home cinema system. «That’s the only way to really enjoy a DVD,» he said. At the age of 30, Christos still lives with his parents, but that doesn’t bother him. «I can’t afford to rent my own place yet,» he explained. «My salary goes out of each pocket, left and right.» Christos might not be absolutely typical of other young people of his age, but is indicative of a trend toward a consumer model in which the purchase of basic goods takes second place to luxuries, particularly communications- and technology-related. So what if this spells trouble paying off the mortgage or meeting car payments? One just has to have a plasma-screen TV, after all. Changes in consumer behavior were recorded in a Family Budget Survey carried out from February 2004 to January 2005 by the National Statistics Service (NSS). The study focused on monthly purchases in 6,555 households with a total 17,386 members from all over the country. Comparisons with a similar survey in 1998-1999 show there has been a definite slowdown in consumer spending. Now we are spending 12.15 percent more than in 1999 (when the increase over 1994 was 22 percent), that is about 1,792 euros a month per household. However there has been a shift from outlays on food and clothing to other categories, chiefly communication. The outlay for food has dropped slightly from 17.40 to 17.10 percent of monthly income, on clothing from 9.32 to 8.38 percent, and on hotels, cafes and restaurants from 9.96 to 9.61 percent. In contrast, spending on transport has risen from 12.17 to 12.60 percent, housing from 10.11 to 10.69 percent and communication from 3.53 to 4.52 percent. This translates into 80.95 euros per month on communication, more than half of what we spend on clothing (150.15 euros) and nearly as much as on entertainment (90.11 euros) and a quarter of what we spend on food (306.44 euros). A breakdown of individual categories reveals changes in the consumer profile. People are spending less (0.77 percent) on vegetables, meat (0.75 percent), fruit (0.55 percent) and coffee, tea and cocoa (0.34 percent) but more on olive oil and other fats (0.33 percent), sugar, jam, honey and confectionery (0.45 percent), mineral water, fruit juices and soft drinks (0.43 percent) – that is, new products advertised on television. According to the head of the survey, Yiannis Douros, the trend toward food products of secondary value shows a change in priorities that researchers expected. «We thought spending on food would have dropped to 16 percent, in accordance with trends over the years. However, it seems that the euro and the high cost of living played a part here,» he explained. He said the trend reflects an increase in incomes and the contemporary way of life. «For example, more and more people are eating out,» he said. The survey shows that households’ greatest outlay every month is on restaurants and cafes (8.60 percent), while meat purchases are in fifth place (3.78 percent). The NSS also recorded a considerable improvement in Greeks’ living standards in comparison with the previous five-year period. The number of families with a second home increased from 14.5 to 17.7 percent, those with at least one mobile phone more than doubled (from 33.4 to 74.33 percent). There was also a 100 percent increase in the use of indoor garages (from 4.7 to 8.97 percent), personal computers (34.02 from 12.1 percent in 1999), microwave ovens (26.05 from 11.6 percent) and cars (66.62 from 52.3 percent). Home ownership also rose from an already high percentage of 79.6 percent to 80.05 percent, the biggest increase being in the cities (from 72.53 to 73.53 percent).

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