UK household finances rise this month

Household finances have picked up from the record low recorded last month but current prospects for public sector workers look gloomier than ever, figures reveal.

The Markit Household Finance Index for September shows a small climb to 35.1 from August's record low of 33.2.

But the figure remains close to the lows recorded at the height of the recession in early 2009. Some 37 per cent of people said their finances had deteriorated since August, while just 7 per cent said there had been an improvement.

Public sector workers reported that their current finances deteriorated at a record rate for the survey, but they were less pessimistic about their future finances.

In contrast, private sector workers reported the smallest deterioration in their current finances for five months.

There was a substantial squeeze on cash available to spend – the second sharpest fall after August's figures – and, alarmingly, household spending rose for the seventh successive month.

Consumers said they felt less secure at work, with government workers most insecure about their jobs.