British families had a bit more money left over each week this spring, but new figures show poorer households are still finding it hard to make ends meet.
Data for the first three months of this year shows that the average household had £257 a week to spend after paying taxes and basic bills. That’s about £25 more than a year ago.
Most of this extra money went to higher earners. Families on lower wages have seen little change. In parts of the UK, especially Northern Ireland, people still have the least money left over each week — only about £139, even after the biggest growth in earnings.
In London and the South East, incomes look better on paper. Families there earn more, but high rents and mortgages mean the extra money doesn’t stretch far.
The gap between rich and poor remains wide. Households in the bottom 40% by income are still short by about £70 a week compared to what they needed before the cost-of-living crisis began.
Prices for food and energy remain high. Even though inflation has come down a little, many bills have not. Higher minimum wages and new tax costs for businesses have pushed up prices in shops and for services.
Supermarkets know shoppers are watching every penny. New price checks show Aldi and Lidl still offer the cheapest baskets for basic groceries. For bigger shopping trips, Asda often beats its rivals. Tesco and other chains have cut prices on basics to match the discounters. More than a quarter of all groceries are now bought on deals or discounts.
But cutting prices does not fully fix the problem. Many families are spending less overall. Retail sales dropped again in May. People are skipping treats and sticking to essentials.
Experts think inflation will stay higher than the Bank of England’s 2% goal for some time. Jobs are still out there, but wage growth could slow down later this year.
For poorer families, it means the squeeze is far from over. Even when they find savings at the checkout, the next bill is always waiting.
