Brits just wanna have fun — at any cost

A music festival that took place in the South-West of England in May did something almost unheard of in Britain at the moment. It reduced its ticket prices by a third. 

“We sold out very, very fast,” Rupert Morrison founder of the Sea Change festival held in Totnes, Devon, told POLITICO. 

It might seem counterintuitive at a time when the country — and indeed the European continent — seems to be going crazy for live music events. Glastonbury managed to jack up its prices by 20 percent this year and sold out within minutes. Beyoncé’s sell-out tour appears to have moved the dial on Sweden’s inflation rate last month and Taylor Swift is set to do the same across Europe next year.

Britons in particular, it appears, just wanna have fun at any cost. That appears to be the latest message from inflation figures in the U.K. for May. The Office for National Statistics deliberately singled out a spike in costs for admission fees to live concerts as a contributing factor to the stubbornly high inflation rate of 8.7 percent. Other factors pushing inflation higher included holidays, gaming and mobile phone expenditure. 

“Partly reflecting pent-up demand from the time of the pandemic, U.K. households are spending more money to have fun,” said Holger Schmieding, chief economist at Berenberg Bank. 

Morrison decided to keep his prices down this year despite rising costs for logistics, security and personnel because he felt his festival was vital to the arts and music scene in his part of the country and he proved it could be done. But he could also be ahead of the game, heralding what’s in store for the British economy once the country has finally run down its pandemic-era savings.  

“If you can charge more and get away with it I do understand,” says Morrison. “People are literally just click, click, click. But I am sure there will be some buyer’s remorse.” 

He added people are driven to the big music festivals for the whole “peak-bourgeois” experience: Last year, at Latitude Festival you could even get Waitrose orders delivered.

The shifting big squeeze

Britons are being squeezed more than ever. Real incomes, that is, incomes adjusted for inflation, have now stagnated for more than a decade, according to Paul Johnson, director of the Institute for Fiscal Studies. He doubts that anything that severe has happened since the Napoleonic Wars.

But the nature of the squeeze is changing. While last year, inflation was driven by a spike in energy and food prices, it’s now being driven by services prices, which tend to be determined more by wages, and which consequently tend to be ‘stickier’ than prices for everyday stuff.

On top of all that is a crisis brewing in the housing market as mortgage rates soar. 

As such, Britons’ spending spree seems to be living on borrowed time. Taylor Swift concerts might be insignificant in the big picture, but the smaller treats in life, aren’t. And the cost of things such as cinema and funfair visits is rising steeply,

A ride on a funfair these days can cost up to £5. Not all funfairs are surviving. Vintage steam fair Carters announced it would close for good last year, after touring the UK for 45 years, plagued by a shortage of labor and the lack of available storage for its rides.

“It’s so expensive, you have to choose your favorite kid,” said mother-of-three Alexandra Hewazy. 

“This is a one-off,” says Schmieding. “The willingness to spend is high right now but it won’t get much higher. Consumers do have the money right now but we will likely see a slowdown after four quarters of stagnation.”