Repaying debts has replaced booking holidays as the number one priority for consumers, according to a survey by analyst PricewaterhouseCoopers.
But holidays remain at number two on the spending list, although short breaks have dropped from second place to eighth since a previous survey in April.
The survey of more than 1,500 consumers in April put debt repayment in sixth place. Now it suggests repayment of credit cards, loans and overdrafts is the top priority, with major holidays second – although 16% of those surveyed made a holiday their leading item for spending.
Among those aged 25-34, only 8% would prioritise spending on holidays – compared with 27% over 65.
PricewaterhouseCoopers head of travel Malcolm Preston said: “The industry is not immune to the downturn. Those with less disposable income are prioritising the repayment of unsecured debt. However, these results show the UK consumer is still set on escaping.”
But he warned: “For many, the recession is hovering in the background. The question is whether intent is aligned with reality.”
Holiday spending was already falling as a proportion of total household spending before the downturn, according to official figures.
The Office for National Statistics reports average spending on holidays fell 40p a week to £13.40 in 2007 – a decline of 2.9%.
The annual study of 6,000 UK households found spending on most categories rose between 2006 and 2007 – with total spending up just over 2%.
Total household spending is expected to fall sharply this year.