July 24, 2009 01:00 ET

Unemployment Rise Increases the Financial Debt Burden for Consumers

CHORLEY, UNITED KINGDOM--(Marketwire - July 24, 2009) - With the UK unemployment rate now at 7.6%, the highest in more than 10 years according to the latest figures released by the Office of National Statistics in May, unemployment is now at 2.38 million.

This rising figure is likely to bring more difficulties for those battling against debt problems and the number of people seeking debt advice is expected to increase in line with these new unemployment figures.

Chris Moat CEO of the Debt Management company ClearStart has commented on the increase and has outlined the circumstances people may need consider as a result of unemployment rising this year, he commented:

"Labour Market Statistics have today revealed a rise in unemployment figures. Whilst there has been much talk on the impact this economic crisis has on the availability of consumer credit and the impact on borrowers, it is vital that consumers faced with financial adversity are looking at ways to cut down on their expenditure and to reduce the danger of being unable to make repayments, forcing themselves deeper into debt.

Our own research indicates that redundancy is cited as the single biggest reason why consumers fall into financial difficulties (42% of consumers). Thankfully according to the Labour Market Statistics most unemployment is temporary in nature with over 75% of consumers finding a new job within 6 months.

It's therefore essential that in the event of unemployment consumers make sure that they keep their creditors up to date with their situation. Creditors adhering to the "Treating Customers Fairly" principles should deal with consumers sympathetically and providing early action is taken finances can be kept under control.

However, even with such steps some consumers will simply find the burden of debt too much if they are out of work for even a few months. In such cases an early call to a debt advisor is essential in order to deal with these problems quickly. Services such as ClearStart will review every aspect of someone's finances. It is important that consumers seek free and impartial debt advice to ensure that they choose the best options available to them to gain control of their finances."

ClearStart Recommendations are based on a consumer's individual situation and all advice is free. The website, offers practical advice for people and provides an online application form or there is a ClearStart freephone telephone helpline available on 0800 988 9345.

Contact Information

  • ClearStart
    Louise Dolan / Cortney Thomson
    020 7269 7192 / 7209