城市研究所-英国的金融脆弱性：从英国脱欧到COVID-19大流行（英文）-18页_439kb

Summary of Financial Vulnerability in the United Kingdom

Core Content

This document presents an analysis of financial vulnerability in the United Kingdom from Q3 2017 to Q2 2020, focusing on the impact of Brexit and the COVID-19 pandemic. It introduces the Financial Vulnerability Index (FVI), a new tool that measures household financial vulnerability at the national, regional, and parliamentary constituency levels. The index is based on six key components that reflect both daily financial management and resilience to economic shocks.

Main Findings

• Financial vulnerability increased over time, particularly during the pandemic.
• The FVI showed a steady rise during Brexit negotiations, with a dramatic spike after the onset of the pandemic.
• London experienced the largest increase in financial vulnerability, especially in areas like Tottenham, Walthamstow, East Ham, and Brent Central.
• North East England had the highest financial vulnerability throughout the study period, while South East England was the least vulnerable.
• The three most vulnerable constituencies in Q2 2020 were Blackpool South, Liverpool Walton, and Middlesbrough.

Key Components of the FVI

The FVI is composed of the following six components:

1. Carrying defaulted debt – Reflects inability to meet financial obligations.
2. Using alternative financial products – Indicates reliance on non-traditional, often high-cost, financial services.
3. Claiming social benefits – Reflects the need for government support due to financial distress.
4. Lacking emergency savings – Shows limited ability to buffer against unexpected expenses.
5. Holding a high-cost loan – Signals financial strain and reliance on expensive credit.
6. Relying heavily on credit – Reflects frequent use of credit, potentially indicating financial instability.

These components are standardized, weighted using factor analysis, and normalized to a 0–100 scale to allow for geographic and temporal comparisons.

Trends in Financial Vulnerability

• The FVI increased from 33.8 in Q3 2017 to 46.2 in Q2 2020, with the largest increase between Q4 2018 and Q2 2020.
• The share of adults claiming social benefits rose from 4.5% in Q3 2017 to 13.5% in Q2 2020, showing a dramatic increase due to the pandemic.
• Credit use among Lowell consumers increased from 43.6% in Q4 2018 to 52.3% in Q2 2020, highlighting reliance on credit during financial shocks.
• The share of adults in default and those with high-cost loans showed smaller increases, suggesting these indicators are less sensitive to short-term shocks.

Regional and Constituency Analysis

• North East England had the highest FVI across all regions, due to high unemployment and low incomes.
• South East England had the lowest FVI, attributed to higher disposable incomes and lower poverty rates.
• Blackpool South, Liverpool Walton, and Middlesbrough were the most vulnerable constituencies in Q2 2020, with index scores significantly above the national average.
• York Outer, Mole Valley, and Richmond Park were the least vulnerable, with lower shares of adults in default, with high-cost loans, and claiming social benefits.

Comparison with Other Indicators

• The FVI is moderately correlated with unemployment rates and low financial satisfaction, suggesting that financial vulnerability is not solely driven by employment status.
• There is a strong positive correlation (0.81) between the FVI and the English Deprivation Index, indicating that financial vulnerability aligns closely with overall deprivation levels.

Index Construction and Methodology

• The FVI is built using data from Lowell, ONS, and the Financial Conduct Authority.
• The index is normalized to a 0–100 scale and standardized using z-scores.
• Factor analysis is used to determine weights for the components, aiming to capture maximum variance with minimal factors.
• Data limitations include the lack of time variation for some components, such as alternative financial products and emergency savings, which are based on single observations.

Conclusion

The FVI provides a new, comprehensive measure of financial vulnerability in the UK, capturing trends over time and variations across regions and constituencies. It highlights the uneven distribution of financial health and the impact of economic shocks on different parts of the UK. The index is designed for policymakers to target resources and support inclusive recovery. Future research will focus on refining the index and exploring the underlying causes of financial distress.