By Judith Woods Last Updated: 7:11PM GMT 24 Feb 2009  Hands up if you feel good about the future. Don’t all rush at once. What, no takers? Perhaps you’re experiencing the difficult birth pangs of a new global order, as Gordon Brown patronisingly called it. Maybe you’re wondering when your very own £500 billion bail-out will be arriving – that’s on condition you don’t do anything silly, like lend it out to kick-start the economy.  Or, more likely, you feel as though you are standing on the edge of an abyss, and waiting for your job, house, school fees and savings to be sucked into the black hole of the deepest recession in a century.  That’s if it hasn’t happened already.  “I’ve got chronic insomnia, and my stomach churns every morning when I go into work, in case I’m summoned into my boss’s office and told to clear my desk,” says one employee of a City bank.  “I don’t know anyone who isn’t appallingly stressed. My wife and I were planning on having a second child this year and moving out of our flat into a house, but there’s no way we can even contemplate that now, which makes her feel very sad and me feel very angry.”  In the current climate of fear and uncertainty, it’s little wonder that hopes are on hold and dreams deferred; planning ahead is a luxury few can afford when simply making it through to the next salary slip is as much as many people can manage.  Unlike the recessions of the early Eighties – when manufacturing and manual workers took a hammering – and the Nineties – when the white-collar sector was affected – top earners are among those being worst hit in the current downturn.  According to an analysis by the Office for National Statistics, architects, lawyers, tax advisers and commercial pilots are among the fastest-growing sectors for claims of jobseekers’ allowance. It’s a crushing comedown for those who have worked hard to establish high-flying careers and take pride in their self-sufficiency.  Just under a year ago, this newspaper highlighted how the middle-class, middle-income backbone of Britain was buckling beneath the burden of punitive taxation, high utility bills and council tax rises. With typical stoicism, professionals were quietly labouring away, paying the mortgage, putting teenagers through university and looking after elderly parents.  We identified them as the Coping Class, and urged the Government to pay heed to their plight. Instead, the squeeze continued, and now, with the economy in freefall, the value of savings plunging with every interest-rate cut, and unemployment set to reach two million any day, and three million by next year, the Coping Class is no longer coping.  "In this recession we’re seeing something new and dramatic: high-income unemployment,” says Graeme Leach, chief economist at the Institute of Directors. “These are individuals with nice houses and two children in private schools, who are suddenly seeing their standard of living plummet. This will be one of the hallmarks of this recession.”  It is a sentiment echoed by Ruth Lea, economic adviser to the Arbuthnot Banking Group. “There are now proportionately far more middle-class jobs than there were back in the Eighties, and many of those will be affected,” she says. “The metropolitan areas, especially affluent areas of London, will feel this recession far more acutely than in previous periods of economic contraction.”  Lorraine Smallwood, a solicitor from Solihull, was shocked to the core when she was made redundant last summer. Smallwood, 43, who is single, specialised in conveyancing and had made partner in a local law firm. But when the bottom fell out of the property market, she found herself laid off, and hasn’t worked since.  “I was absolutely devastated,” she says. “I’ve always put my career first and given my all to work, and becoming partner had always been my ambition.  “I thought I was in a stable profession and that I would be with the firm for the rest of my working life, but now I’m left scouring the internet every day, looking for job vacancies and wondering how I’m going to pay my huge mortgage.”  Smallwood admits she didn’t see the recession coming. When work started drying up in early summer, she assumed the market would right itself, and, with a few adjustments, the sector would continue to thrive.  “I thought that people would always buy houses, regardless of what was going on in the wider economy, but things didn’t pick up and the situation is dire. I’ve never known anything like it in 25 years.”  Jobs are few and far between, so Smallwood has enlisted the business and confidence coach Steve Miller to help hone her CV and interview skills. Miller says that he is inundated with enquiries from prospective clients, many of whom are in great distress.  “Professional people are losing not just their jobs and incomes, but their status and their self-esteem,” says Miller. “I would say 80 per cent of clients don’t even mention the salary that’s disappeared overnight; it’s their state of mind that’s the immediate issue.  “Executives are used to working hard and feeling they’re making a contribution – to the economy or society, or both. To have that taken away is a huge blow.”  Make no mistake, the blows are raining down hard. Across the country, two words that we hoped never to hear again are being spoken in tones of dread. As the value of property falls, negative equity is returning, with more than half a million home owners now living in a property worth less than the loan they took out to pay for it.  As the numbers rise by an additional 21,000 a week, the total looks likely to surpass the 1.7 million peak reached in the early Nineties. And if, as some fear, house prices drop by as much as 30 per cent from 2007 levels, 2.5 million people – that is, about 21 per cent of mortgage holders – will find themselves in negative equity. Meanwhile, the Council of Mortgage Lenders reports that repossessions soared by 54 per cent last year to a 12-year high of 40,000.  The outlook is bleak, too, for many in business; a record 200 people were declared bankrupt every day at the end of 2008, reaching a high of 19,000 in the last three months of 2008, up 22.2 per cent on the same period a year earlier, figures from the Insolvency Service show.  Against this dismal backdrop, more than 170,000 professionals have lost their jobs in the financial markets over the past year, and the City has been the hardest hit. On the influential website www.hereisthecity.com, the regularly updated Job Loss League Table makes for depressing reading, as layoffs run into tens of thousands at the likes of Citibank, Merrill Lynch and Credit Suisse.  And behind every credit crunch statistic is a story. Take Simon, 46, who worked as a manager in the car industry and who was made redundant in December. His wife is a nurse and has been working overtime to pay the mortgage – the utility bills are another matter.  “I’m still dazed by what’s happened,” he says. “We used to take foreign holidays twice a year, now I’ve become one of those people whose heart sinks when they get a letter from the mobile phone company.”  David, 39, is using up money set aside for his seven-year-old son’s private secondary education to finance the family’s day-to-day living, until he can find a new job in the IT sector, which looks increasingly remote.  “Four months ago, I was earning £41,000, and although we didn’t live lavishly, we had a nice lifestyle and outgoings that corresponded to my income,” he says. “I’m at my wits’ end as to what to do now. My wife is American, but there’s no point moving over there because, if anything, the situation’s worse.”  At accountancy firm KPMG, thousands of staff have applied to work a four-day week or take an extended 12-week holiday, under moves to avert large-scale job losses. Two thirds of its 11,000 British staff have agreed to the scheme, although no date has yet been set for its implementation.  Ceri Hughes, 35, who works in research and information at the company, has put herself forward for both options. If she moves to a four-day week she will lose a day’s pay. If she finds herself taking a sabbatical, she will receive 30 per cent of her wages.  “I was happy to sign up, because I felt KPMG was showing a commitment to avoid redundancies,” she says. “I’m studying for an MBA at the moment. so if I take an extended break I’ll spend time completing my dissertation, and on doing charity work.  “I feel reassured that this scheme is in place, and I think it has motivated people and enabled them to focus on the job in this volatile economic climate.”  Hughes may feel reassured, but she is in a lucky minority. Concern is growing about job security and there are fears, too, that the public sector will soon start to feel the pinch.  “Everyone is suffering, but this is a particularly tough time for the middle class,” says Matthew Elliott, of the TaxPayers’ Alliance.  “They’ve been taxed to the hilt, are weighed down by high mortgages, and although there’s been a reduction in food prices since last year, they’re still historically high.  “The coping classes are anxious about losing their jobs, and those that are in work are facing difficulties because employers may not be able to give them a pay rise this year. When they read about banks handing out bonuses and MPs claiming exorbitant expenses they’re quite rightly furious about the double standards at play.”  Our certainties are crumbling around us by the day, and not just because the makers of the Aga are in trouble and Viyella has gone into administration (although it has been saved for the nation by Austin Reed). Nannies’ wages might have fallen with the downturn, but when your husband has been laid off you don’t need – and certainly can’t afford – to pay someone to look after the kids, even if depressed former quantity surveyors aren’t nearly as much fun as proper childminders.  Thrift is the byword; we’ve sacked our cleaners, we’re exercising our own pets, rendering both the dog-walker and the personal trainer surplus to requirements, and when Lord Turner, chairman of the Committee on Climate Change, recently declared that families could face flight rationing in order to cut greenhouse gas emissions, we merely shrugged our sagging shoulders in mute acceptance; long-haul holidays are the last thing on our minds.  Instead of idly leafing through Abercrombie & Kent safari brochures, the sandwich generation is scrabbling through bank statements. They have been left wondering how they can afford to keep the children on at their independent school, while subsidising their parents.  About nine million retired people have seen their income from savings virtually wiped out by Mervyn King, whose obsession with slashing interest rates has not only wiped out pensioners’ income, but signally failed to have any discernible effect on the flow of money.  “The problems in the banking sector aren’t due to the cost of credit, but the availability of credit,” says Tim Knox, at the Centre for Policy Studies. “Taking action which penalises the little good guys to try and bail out the big bad guys is immoral and illogical.  “It’s savers, the silent majority, who are being asked to pay for the foolishness of the greedy minority.”  Under the circumstances, it came as no surprise when the Bishop of London’s insensitive observation that losing one’s job could be “a blessing in disguise” for those chained to their desks was met with widespread hostility. A great many found it galling to be told that redundancy is good for the soul by a man receiving an annual stipend of £54,000.  But Lynette Savings concedes that being laid off has, indeed, enabled her to “escape the treadmill” and take her life in a different direction. Savings, 57, from London, was head of policy at a national charity until she was made redundant last year. Her way of coping was to join Voluntary Service Overseas, and she is shortly due to leave for Vietnam.  “I was very panicky when I realised I might be in danger of losing my job, and shocked when it actually happened,” she says. “But when I thought about it, I felt that this was a perfect opportunity to turn misfortune into something positive.  “I’d been thinking about volunteering overseas for a couple of years, and when I did my sums I calculated I could just about afford it if I rented my home out. Although you can’t live like a prince, VSO gives you accommodation and pays enough for you to stay alive and have a beer or two now and again.”  Based in Hanoi, Savings will be providing management support for an non-government organisation working in the field of HIV and Aids.  “A lot of people think that VSO is about having a gap year, but I’m going out there to do a job of work, and I hope that when I return to the UK, the economy will be better and the skills I’ve gained will put me in a good position,” she says.  “Or it may be that the outlook isn’t much better, in which case I’ll look for another posting and possibly stay away from Britain indefinitely.”  Needless to say, enquiries to VSO are on the rise, but not everyone can take a temporary leave of absence from their life, however tempting. And so, as every radio bulletin brings fresh news of redundancies, company closures, and venal bankers whingeing about their bonuses, the worried middle classes are reduced to scrimping and saving to keep our heads just above the quicksand that threatens to engulf us.  We’re battle-weary, broke, and deeply disillusioned, but are we still coping? No, not coping, sinking – into a quagmire of toxic debt and financial oblivion. And only time will tell what the long-term consequences for society will be.
A year ago, the Telegraph identified the 'Coping Classes': solid, responsible    citizens beaten down by rising bills and taxation. But now things are much    worse; they are battle-weary, broke and deeply disillusioned.