Compare the Market - Rising cost of car ownership could jeopardise jobs for one million young workers who rely on vehicles for work

Rising cost of car ownership could jeopardise jobs for one million young workers who rely on vehicles for work

• 44% of young drivers who don’t own a car say it is because they can’t afford the costs of fuel, insurance and upkeep


• Over a quarter (27%) of young people fear that if they could no longer afford to drive they would risk losing their job


comparethemarket.com calls on the government for IPT to be abolished for young drivers

02 May 2018 – Spiralling driving costs are jeopardising young people’s job circumstances by making it harder for them to get to work and therefore keep their jobs, according to new research from comparethemarket.com.

Over two thirds (69%) of young drivers (aged between 17 and 24 years old) rely on their car as part of their regular commute to work, school or university, with 41% saying they use their car every day. However, the growing costs of owning a vehicle are increasingly unaffordable for young people; 44% of drivers aged between 17-24 who have a driving license, but don’t own a car, say it is because they can’t afford the upkeep, fuel and rising insurance costs.  

comparethemarket.com’s latest Young Drivers report found that the cost of running a car for this age group has risen by £180 over the past two years, primarily driven by increasing fuel and insurance prices. On average, a 17-24-year-old driver will now pay £2,381 to run a car in their first year of driving, of which, more than half (£1,348) is the cost of insurance cover.

When thinking about their quality of life, nearly half (47%) said that having a car was “very important” to them. Furthermore, should they no longer be able to afford to drive, nearly one in five (17%) would have to move to a new house in a location with better transport links, and over a quarter (27%) of young people said their job would be put in jeopardy – equating to over one million jobs at risk nationwide.

The recently announced government initiative to impose restrictions on newly qualified drivers, which includes a ban on driving at night, has been met with scepticism by young motorists. While it is suggested that such restrictions could reduce crashes and drink-driving, and may even lower insurance costs, six in ten (60%) agreed it would make driving more difficult for young people and 40% thought it would reduce the number of people who learn to drive.

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Simon McCulloch

Director

comparethemarket.com

“Young people are fed up with the astronomical cost of driving. Insurance and fuel costs have increased significantly over the years and there is a real risk of young people being forced off the road. The burden of Insurance Premium Tax – which has been raised three times in under three years – is an additional and unwelcome expense.

“If the definition of a stealth tax is one which people don’t know about or understand, then Insurance Premium Tax fits this category precisely. According to our research, 82% of young drivers do not know what the current rate of tax is and yet it adds an average of £161 to their bill each year.

“We urge the government to introduce a limit on IPT for drivers under 24, or remove it all together. Our research shows that 61% of young motorists do not think that the government is currently working hard enough to make driving affordable for young people. Failing to do so will make it harder and harder for this key segment of the workforce to get to their place of work.”