Paying the price of our mental health in the cost-of-living crisis

The monthly blog of the Public Mental Health Implementation Centre (PMHIC), 'Perspectives on public mental health', aims to highlight the voices of practitioners, patients, carers, and public health experts.

Shari McDaid, Head of Policy and Evidence for Scotland and Northern Ireland at the Mental Health Foundation, has an urgent message about the impact of the UK's cost-of-living crisis on mental health.

What happens to the mental health of a nation facing its worst cost-of-living crisis in over 40 years? That is the question facing the UK now, at the start of 2023.

There are reports of financial stress being experienced across the UK, with many people cutting back on essentials such as food and energy. What does this financial stress mean for the UK population’s mental health? At the Mental Health Foundation, we have been considering this question and recently published our analysis, Mental Health and the Cost of Living Crisis: A new pandemic in the making?.

For many, these experiences are not new – and might not only relate to recent economic changes.

The UK population’s relative poverty rate after housing costs has been over 20% since 1994, with the exception of the unusual period of 2020–21, when the average income fell. And some of the demographic groups that are now at higher risk of financial strain will be the same as those who were at greatest risk of poorer outcomes during the pandemic (younger workers, low wage earners and people from Black and minority ethnic communities), as shown in the Mental Health Foundation study Coronavirus: Mental Health in the Pandemic. 

Also, people with a diagnosis of a mental health disorder are at increased risk of experiencing unemployment and financial stress.

It is well established that poverty is bad for people’s mental health: socioeconomic deprivation is associated with increased risk of most mental disorders, and this association can come from both material deprivation and subjective financial strain:

• Economic stress impacts on the mental health of children and adolescents through its influence on parental mental health, marital interaction and parenting.
• Debt is a risk factor for poor mental health, especially unsecured (short-term) debt, which people often resort to in times of short-term financial strain.
• Unemployment, which may rise if the UK stays in recession, is also a substantial driver of poor mental health.

Our own UK-wide poll, carried out in November 2022, indicated early signs of mental distress in the population. One in ten (10%) UK adults reported feeling hopeless, more than one-third (34%) were anxious, and over one-quarter (29%) were stressed because of financial worries in the past month. 

Worryingly, at the time of the poll, many people reported showing signs of not being able to do some of the activities that protect mental health, with 30% of adults reporting poorer sleep, 23% meeting friends and family less often and 12% exercising less often.

However, negative mental health outcomes are by no means inevitable. Many of these adults will not yet have reached a clinical threshold of mental disorder, so there is still an opportunity for prevention.

Public authorities’ actions can mitigate financial strain-related distress, reducing the risk of this developing into mental disorders. Fundamental to this is providing people with enough income for a decent standard of living; we are not there yet, even after 2022’s Autumn Statement announcements on cost of living payments: the Joseph Rowntree Foundation calculated that someone who is unemployed, on a low income, aged over 25 and renting a room will be £538 worse off.

Additional income measures that could help include normalising the real Living Wage, eliminating the waiting time for Universal Credit and increasing benefits in line with the real level of inflation experienced by people on low incomes.

Increasing access to debt relief will also be important. Local governments play an important role in ameliorating the effects of poverty through food and other supports, however their capacity to do so has withered under funding cuts.

There are also measures that can help boost people’s access to supports that promote mental health.

For example, building the capacity of frontline social security, debt advice and anti-poverty workers to respond effectively to the mental health effects of financial strain, and investing in the capacity of community organisations working with people experiencing poverty to provide preventative mental health support. So, too, is providing affordable public transport so that people can stay connected with family and friends, and have access to work and healthcare, as well as ensuring that people can maintain their broadband connectivity and avoid digital deprivation.

The cost-of-living crisis could not have come at a worse time, after two years of COVID-19 pandemic stress. The costs of mental health problems to the UK economy are staggering, at an estimated £117 billion each year, according to the Mental Health Foundation’s 2021 report, Economic Case for Investing in the Prevention of Mental Health Conditions. This report identifies a number of cost-effective interventions to prevent mental health problems across the life course, as does Jonathan Campion’s comprehensive 2019 report on public mental health.

The question is, will a similar, whole-of-society effort be undertaken to prevent a further rise in mental health problems during this new crisis?

Shari McDaid, PhD

Head of Policy and Evidence for Scotland and Northern Ireland, Mental Health Foundation