The high cost of living and credit, the greater indebtedness of households, the effect of the cancellation of the Day without VATJust as the lower supply of many products took a heavy toll on Colombian families, who had to tighten their belts when it came to celebrating Christmas.
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Last year, due to these factors, households spent 32.8 trillion pesos, some 4.9 trillion pesos less at today’s prices than at Christmas 2021, which indicates a 12.9 percent drop. .
This decrease is seen after in December 2021 the expenses for the celebrations had registered a growth of 22 percent in real terms.
Among the reasons for the drop is the fact that «for years the number of novenas that are celebrated in the family has decreased, which affects part of the basket,» warns the Raddar consulting firm in its already traditional year-end report on the performance of household spending, which last year totaled more than 941.5 trillion pesos, a real annual growth of 3.4 percent.
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According to the consultant, despite the inconveniences registered last year both in terms of high prices and less supply of some basic products, especially food, these have reached a greater weight within the Christmas basket of Colombian households.
For example, last Christmas, food represented 41.6 percent of the spending allocated to this celebration and contributed 31.4 percent of all things purchased, demonstrating the importance of dinners in the celebration. In 2019, for its part, these were only 31.6 percent of that total spending and represented 31.3 percent of everything purchased.
In addition to food, transportation and communications are other items that have gained space in that basket, while entertainment loses ground.
«Health and education are baskets ‘unrelated’ to Christmas, but they always have a significant impact due to the conditions of each group, ranging from health spending for the season to surgeries, and in education, there are cases of enrollment, uniforms and school supplies that are bought in December”, precisely Raddar when highlighting that this basket has presented several changes over time, showing not only the change in preferences, fashions, tastes, but also the purchasing power of households and the goods and services available.
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Another relevant data that the consultant’s report shows has to do with the average expense per household during the past celebrations, which exceeded 1.9 million pesos, 6.8 percent more than the 2021 record.
what happened in december
When looking at the behavior of household spending during December, a lower dynamic is also observed due (-1.2 percent), among other factors, to the impact of inflation, a lower arrival of remittances to the country and the drop in placement of consumer loans not only because of the shot in interest rates, but also because of the measures adopted by the Financial Supervision which forces entities to make greater provisions to curb the growth of this portfolio.
According to the consultant, the 2.7 percent drop in the current real minimum wage also contributed to this fall, reaching the same level as it was in March 2018. All this led to spending per person in real terms, according to the Raddar estimate, will have decreased by 3.2 percent in December 2022.
According to Raddar, consumer loans, excluding credit cards, contracted 35.9 percent. However, this effect was offset, in part, by the payment of the christmas bonusthe increase in employment and changes in the composition of the household spending basket.
Despite the fact that in the last month of 2022 families had less access to credit, this alternative continues to be key in family consumption.
About 28.1 percent of household spending last December was made with credit, about three percentage points more than the 2019 record, a sustained growth that has been taking place for several years.
In absolute terms, Colombians spent 102.8 billion pesos in December alone, of which just over 40 percent was used to purchase food.
Despite this, in that 12th month, spending on food fell 2.7 percent. Other consumptions that also dropped considerably last December were education (5.2 percent), fashion (4.3 percent), health (3.6 percent) and home (3.4 percent).
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