The housing costs inflation rate for low-income households in the United Kingdom was noticeably higher than that of high-income ones between April 2022 and April 2023, during a serious cost of living crisis in the UK. As of June 2024, however, the inflation rate for high-income households was higher than that of middle or low incomes ones.

In June 2024, the household cost inflation rate (HCI) for low-income households in the United Kingdom was 1.7 percent, compared with 2.3 percent for middle-income households, and 3.3 percent for high-income households. Unlike other measures of inflation such as the consumer price index (CPI) the HCI isn't based on a fixed basket of goods, but is weighted to show how price changes affect different households by their economic status.

In June 2025, 62 percent of households in Great Britain reported that their cost of living had increased in the previous month, compared with 72 percent in April. Although the share of people reporting a cost of living increase has generally been falling since August 2022, when 91 percent of households reported an increase, the most recent figures indicate that the Cost of Living Crisis is still ongoing for many households in the UK. Crisis ligers even as inflation falls Although various factors have been driving the Cost of Living Crisis in Britain, high inflation has undoubtedly been one of the main factors. After several years of relatively low inflation, the CPI inflation rate shot up from 2021 onwards, hitting a high of 11.1 percent in October 2022. In the months since that peak, inflation has fallen to more usual levels, and was 2.5 percent in December 2024, slightly up from 1.7 percent in September. Since June 2023, wages have also started to grow at a faster rate than inflation, albeit after a long period where average wages were falling relative to overall price increases. Economy continues to be the main issue for voters Ahead of the last UK general election, the economy was consistently selected as the main issue for voters for several months. Although the Conservative Party was seen by voters as the best party for handling the economy before October 2022, this perception collapsed following the market's reaction to Liz Truss' mini-budget. Even after changing their leader from Truss to Rishi Sunak, the Conservatives continued to fall in the polls, and would go onto lose the election decisively. Since the election, the economy remains the most important issue in the UK, although it was only slightly ahead of immigration and health as of January 2025.

In 2018-19 the GLA first undertook a Survey of Londoners. At the time it provided vital evidence on Londoners that had never been collected before in such detail. In 2021-22, the GLA conducted another Survey of Londoners, following the same methodology as the Survey of Londoners 2018-19, an online and paper self-completion survey of adults aged 16 and over in London. The survey, which received responses from 8,630 Londoners, aimed to assess the impact of COVID-19 and associated restrictions on key social outcomes for Londoners, not available from other data sources. It is important to understand the context in which the Survey of Londoners 2021-22 took place. Survey fieldwork began in November 2021; so, up to that point, it had been four months since most legal limits on social contact had been removed. However, after fieldwork had started, some restrictions due to the emergence of the Omicron variant were introduced. This may or may not have had some effect on the data. Given these changing circumstances, caution should be applied when interpreting the results. The Survey of Londoners 2021-22 also took place just before the full effects of the cost-of-living crisis began to set in. It is highly likely that the situations of Londoners have changed while analysis was taking place. On this page there is a headline findings report, published on 30 September 2022, which provides descriptive results for the key headline measures and supporting demographic data collected by the survey. Accompanying this report are more detailed tables documenting the key results of the survey by a range of demographic and other characteristics, a short summary document presenting key findings from the survey, and a technical report for those interested in the survey’s methodology. Further to these, a series of pen portraits, providing snapshots of particular groups of Londoners, as captured at the time of the Survey of Londoners 2021-22, were first added on 31 October 2022. Also on this page, there is an initial findings report, that was published on 2 September 2022. This was published to provide timely evidence from the survey to support the case for further targeted support to help low-income Londoners with the cost-of-living crisis. We have launched an online explorer where users can interrogate the data collected from the two surveys, conducted in 2018-19 and 2021-22. This is the first iteration, so we welcome any feedback on it - GO TO THE EXPLORER The record-level Survey of Londoners dataset can be accessed via the UK Data Service, University of Essex. The dataset is available for not-for-profit educational and research purposes only. Finally, as the North East London (NEL) NHS funded a 'boost' in their sub-region to enable a more detailed analysis to be conducted within, they produced an analytical report in September 2022. This is also available for download from this page.

The median annual earnings in the United Kingdom was 37,430 British pounds per year in 2024. Annual earnings varied significantly by region, ranging from 47,455 pounds in London to 32,960 pounds in the North East. Along with London, two other areas of the UK had median annual earnings above the UK average; South East England, and Scotland, at 39,038 pounds and 38,315 pounds respectively. Regional Inequality in the UK Various other indicators highlight the degree of regional inequality in the UK, especially between London and the rest of the country. Productivity in London, as measured by output per hour, was 26.2 percent higher than the UK average. By comparison, every other UK region, except the South East, fell below the UK average for productivity. In gross domestic product per head, London was also an outlier. The average GDP per head in the UK was just over 37,000 pounds in 2023, but for London it was almost 64,000 pounds. Again, the South East's GDP per head was slightly above the UK average, with every other region below it. Within London itself, there is also a great degree of inequality. In 2023, for example, the average earnings in Kensington and Chelsea were 964 pounds per week, compared with 675 pounds in Barking and Dagenham. Wages continue to grow in 2025 In March 2025, weekly wages in the UK were growing by around 5.6 percent, or 1.8 percent when adjusted for inflation. For almost two years, wages have grown faster than inflation after a long period where prices were rising faster than wages between 2021 and 2023. This was due to a sustained period of high inflation in the UK, which peaked in October 2022 at 11.1 percent. Although inflation started to slow the following month, it wasn't until June 2023 that wages started to outpace inflation. By this point, the damage caused by high energy and food inflation had led to the the worst Cost of Living Crisis in the UK for a generation.

The UK inflation rate was 3.4 percent in May 2025, down from 3.5 percent in the previous month, and the fastest rate of inflation since February 2024. Between September 2022 and March 2023, the UK experienced seven months of double-digit inflation, which peaked at 11.1 percent in October 2022. Due to this long period of high inflation, UK consumer prices have increased by over 20 percent in the last three years. As of the most recent month, prices were rising fastest in the communications sector, at 6.1 percent, but were falling in both the furniture and transport sectors, at -0.3 percent and -0.6 percent respectively.
The Cost of Living Crisis High inflation is one of the main factors behind the ongoing Cost of Living Crisis in the UK, which, despite subsiding somewhat in 2024, is still impacting households going into 2025. In December 2024, for example, 56 percent of UK households reported their cost of living was increasing compared with the previous month, up from 45 percent in July, but far lower than at the height of the crisis in 2022. After global energy prices spiraled that year, the UK's energy price cap increased substantially. The cap, which limits what suppliers can charge consumers, reached 3,549 British pounds per year in October 2022, compared with 1,277 pounds a year earlier. Along with soaring food costs, high-energy bills have hit UK households hard, especially lower income ones that spend more of their earnings on housing costs. As a result of these factors, UK households experienced their biggest fall in living standards in decades in 2022/23. Global inflation crisis causes rapid surge in prices The UK's high inflation, and cost of living crisis in 2022 had its origins in the COVID-19 pandemic. Following the initial waves of the virus, global supply chains struggled to meet the renewed demand for goods and services. Food and energy prices, which were already high, increased further in 2022. Russia's invasion of Ukraine in February 2022 brought an end to the era of cheap gas flowing to European markets from Russia. The war also disrupted global food markets, as both Russia and Ukraine are major exporters of cereal crops. As a result of these factors, inflation surged across Europe and in other parts of the world, but typically declined in 2023, and approached more usual levels by 2024.

According to the forecast, house prices in London are expected to fall slightly in 2024, followed by a recovery in the following years. The decline can be explained with the cost of living crisis and the dramatic increase in borrowing costs. As the economy recovers in the next five-years, house prices for mainstream properties are forecast to rise by almost ** percent. In 2023, the average house price in London ranged between ******* British pounds and *** million British pounds, depending on the borough. Barking and Dagenham, Bexley, Newham, and Croydon were some of the most affordable boroughs to buy a house.

The economy was seen by 49 percent of people in the UK as one of the top three issues facing the country in June 2025. The ongoing cost of living crisis afflicting the UK, driven by high inflation, is still one of the main concerns of Britons. Immigration has generally been the second most important issue since the middle of 2024, just ahead of health, which was seen as the third-biggest issue in the most recent month. Labour's popularity continues to sink in 2025 Despite winning the 2024 general election with a strong majority, the new Labour government has had its share of struggles since coming to power. Shortly after taking office, the approval rating for Labour stood at -2 percent, but this fell throughout the second half of 2024, and by January 2025 had sunk to a new low of -47 percent. Although this was still higher than the previous government's last approval rating of -56 percent, it is nevertheless a severe review from the electorate. Among several decisions from the government, arguably the least popular was the government withdrawing winter fuel payments. This state benefit, previously paid to all pensioners, is now only paid to those on low incomes, with millions of pensioners not receiving this payment in winter 2024. Sunak's pledges fail to prevent defeat in 2024 With an election on the horizon, and the Labour Party consistently ahead in the polls, addressing voter concerns directly was one of the best chances the Conservatives had of staying in power in 2023. At the start of that year, Rishi Sunak attempted to do this by setting out his five pledges for the next twelve months; halve inflation, grow the economy, reduce national debt, cut NHS waiting times, and stop small boats. A year later, Sunak had at best only partial success in these aims. Although the inflation rate fell, economic growth was weak and even declined in the last two quarters of 2023, although it did return to growth in early 2024. National debt was only expected to fall in the mid to late 2020s, while the trend of increasing NHS waiting times did not reverse. Small boat crossings were down from 2022, but still higher than in 2021 or 2020. .

As of the third quarter of 2020, residential land value in Central London saw a negative change both on annual and on six-month basis. In comparison, land value in Outer London saw no change on six-month basis and an increase of 0.3 percent compared to one year ago. This highlights one of the effects that the coronavirus (COVID-19) crisis has had on housing demand: rather than living central, many people have decided to prioritize property size. The rise in demand for larger properties with outside space has influenced both rental and housing prices.

From April 2025 onwards, the UK's main national minimum wage category, the national living wage, will rise to ***** pounds per hour, up from ***** pounds per hour in the previous financial year. This amount will apply to workers aged 21 and over, compared with 2022 and 2023 when it was only for workers aged 23 and over, and for those aged 25 and over between 2016 and 2021. The main minimum wage from 2010 to 2015 was the 21+ rate, and 22+ rate between 1999 and 2009. Evolution of the minimum wage Since its introduction in 1999, the minimum wage has had various rate categories, usually based on age. For the first five years, there were two categories, one for workers 18 to 21, and another for workers aged 22 and over. In 2004, a minimum wage for under 18s was introduced, and between 2010 and 2015 there were three rates based on age, and one for apprenticeships. Another age based-rate was added in 2016, but from 2024 onwards, the model will revert to four rate categories overall. In addition to the legal minimum wage, there is also a voluntary real living wage, which for 2024/25 is **** pounds per hour, rising to ***** pounds per hour for workers in London. Wages continue to outpace inflation in 2024 Since July 2023, wages have grown faster than inflation in the UK with December 2024 seeing regular weekly earnings grow by *** percent, compared with the CPI inflation rate of *** percent that month. For almost two years between November 2021 and June 2023, wage growth struggled to keep up with inflation, with the biggest gap occurring in October 2022 when inflation peaked at **** percent. The fall in real earnings in one of the most important factors in the UK's ongoing cost of living crisis. At the height of the crisis, around ** percent of UK households were reporting a monthly increase in their cost of living, with this falling to ** percent by March 2024.

As of 2024, the most expensive national newspaper for UK consumers was FT Weekend (a supplement to the weekend edition of the Financial Times) at five British pounds and ten pence per copy. By contrast, The i and Daily Star both came out at under one pound each. The i cost just 20 pence back in 2014, meaning that the paper's cover price increased by more than fourfold over the last decade. A number of national papers cost over three GBP in 2024, including The Observer, The Sunday Times, and the Saturday edition of The Guardian. Circulation continues to fall Between 2022 and 2023, data on 14 large national newspapers in the UK showed a drop in paid circulation among every publication. Sunday People suffered a decline of almost 20 percent, and Daily Star, Daily Record, and Daily Mirror saw a decrease of 14 percent. With the price of newspapers on the up and the cost-of-living crisis ongoing, it seems unrealistic to expect British consumers to invest in newspapers, and circulation is unlikely to improve. But will consumers invest in online subscriptions? Digital news subscriptions are also costly A number of news subscriptions available to UK news consumers cost in excess of 200 British pounds per year, and most were around the 100 GBP mark. For the 38.9 percent of UK consumers spending between 51 and 100 GBP on online grocery each week, persuading them to invest a similar amount in just one news publication is challenging.

In 2024, gross domestic product per capita in the United Kingdom was 37,044 British pounds, compared with 37,033 pounds in the previous year. In general, while GDP per capita has grown quite consistently throughout this period, there are noticeable declines, especially between 2007 and 2009, and between 2019 and 2020, due to the Global Financial Crisis, and COVID-19 pandemic, respectively. Why is GDP per capita stagnating when the economy is growing? During the last two years that GDP per capita fell and then stagnated in the UK, the overall economy grew by 0.4 percent in 2023 and 1.1 percent in 2024. While the overall UK economy is therefore larger than it was in 2022, the UK's population has grown at a faster rate, resulting in the lower GDP per capita figure. The long-term slump in the UK's productivity, as measured by output per hour worked, has meant that the gap between GDP growth and GDP per capita growth has been widening for some time. Economy remains the main concern of UK voters As of February 2025, the economy was seen as the main issue facing the UK, just ahead of immigration, health, and several other problems in the country. While Brexit was seen as the most important issue before COVID-19, and concerns about health were dominant throughout 2020 and 2021, the economy has generally been the primary facing voters issue since 2022. The surge in inflation throughout 2022 and 2023, and the impact this had on wages and living standards, resulted in a very tough period for UK households. As of January 2025, 57 percent of households were still noticing rising living costs, although this is down from a peak of 91 percent in August 2022.