UK Consumers and the Cost of Living 2023

 The Consumers and the Cost of Living Market Report 2023 provides comprehensive data and invaluable analysis on the cost of living crisis in the UK. Our research examines the impact on consumer financial wellbeing and behaviour, cost of living statistics UK, and the latest trends. Gain insight into how to respond to changing consumer demands and stay ahead of your competition with our cost of living market research.

 Cost of Living Crisis in the UK – Current Overview

The year 2022 was defined by rapidly rising inflation. The squeeze on household incomes has had a profound impact on how people feel about their finances. Not only that, but the cost of living crisis has prompted widespread changes to consumer behaviour. One of the most striking Mintel findings is that almost half of the remote workers are planning to reduce the time they spend working at home as a direct response to increased energy costs. Remote working was a key driver of the pandemic boom in savings as workers saved on commuting and other work-related costs. As energy prices have spiked, however, this benefit has been diminished.

Cost of Living Crisis Consumer Behaviour – Statistics

The biggest behavioural changes have been seen in consumer shopping habits. Consumers are taking a more cautious approach and going to the shops more prepared, such as following a stricter shopping list, buying more reduced items or trading down to cheaper ingredients.

High inflation is no longer the only major threat to household finances. The Bank of England has repeatedly increased the base rate of interest in an attempt to bring inflation back under control, most recently raising it to 4% in February 2023. This has had a knock-on effect on the cost of servicing debts. Already by October 2022, over half of UK adults were worried about the impact of rising interest rates on their finances, rising to four-fifths of mortgage holders.

Cost of living statistics UK

• 45% of remote workers are planning to reduce the time they spend working at home as a direct response to increased energy costs.
• 42% of consumers have followed a stricter shopping list, and 35% bought more reduced items.
• 55% of Brits expect to face high levels of inflation until at least late-2023.
• 64% of consumers were worried about the impact of rising interest rates on their finances, rising to 80% of mortgage holders.

Cost of Living Crisis Consumer Behaviour – Future Outlook & Opportunities

Retailers can assist consumers making savvier shopping choices by publishing and promoting low-cost recipes and educational content around how to replace expensive items with cheaper, but still nutritious ingredients. Such strategies will be particularly appealing to younger consumers, who are more likely to say they have changed their cooking habits, but are the least experienced and therefore least likely to have the knowledge and skills to do so successfully.

In October 2022, over half of Brits expect to face high levels of inflation until at least late-2023, including 23% who foresee steep price rises well into late-2024 and beyond. This means an overall cautious mindset is likely to dominate for the next couple of years. However, longer-term expectations provide opportunities to promote products and services that will help people do more than just ‘get through’ the cost of living crisis in the UK, and help them thrive despite the challenges. The “lipstick effect” is already in full effect across BPC and other broader categories as people hunt down affordable luxuries.

To discover more about the UK Consumers and the Cost of Living Market Report 2023, read our UK British Lifestyles Market Report 2022, or take a look at our other Financial Services Market Research.

Quickly Understand

• The impact of the cost of living crisis in the UK on consumers’ financial wellbeing and confidence.
• Explores how the cost of living in the UK has caused consumers to change every day behaviours in response to high inflation, and what consumers expect to do in the months ahead.
• Examines what areas of spending consumers are most keen to prioritise and protect.
• The level of concern about rising interest rates, attitudes towards government support measures, and the changes in how consumers are searching for products and considering value.
• Consumer attitudes towards the cost of living crisis in the UK, including support for businesses, and changes in the perceived importance of ethical and environmental standards.
• Provides comprehensive data on cost of living statistics UK.

Expert Analysis from a Specialist in the Finance Sector

This report, written by Rich Shepherd, a leading analyst in the finance sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

 Decades-high inflation has prompted significant and wide-ranging changes in consumer behaviour. Savvy shopping and a focus on value has come squarely to the fore, and people are particularly interested in ways to reduce energy use. However, expectations that steep price rises will stick around for an extended period also provide opportunities for brands to innovate to offer consumers the means to thrive, not survive, throughout the cost of living crisis in the UK.”

Rich Shepherd
Category Director – Financial Services and Lifestyles