UK households reduced their spending during the coronavirus (COVID-19) pandemic by an average of £109.10 (or 19%) a week.

During the year to March 2021, households spent less on goods and services that were restricted at various times to control the spread of coronavirus. At the height of the spring 2020 lockdown, more than one-fifth of usual household spending was largely prevented.

Households may have been able to cut back on spending if they were able to shift to home working. Higher income households, who tended to spend more on travel pre-pandemic, and whose workers were more likely to be able to work from home, saw a larger drop in spending than low income households.

However, for some, the reduction in spending may have been associated with a fall in income. Around a third of workers saw their household income fall in the financial year ending (FYE) 2021, rising to 42% for the 20% on the lowest incomes (who were more likely to be furloughed and less likely to be able to work from home than people on higher incomes).

While both spending and income fell for many UK households, people are on average finding it easier to make ends meet, with the proportion of people reporting difficulty in making ends meet falling by six percentage points from 34% in the year to March 2020 to 28% in the year ending March 2021.

Those who had experienced a loss of income were more likely to also report financial pressures, such as difficulty making ends meet. How the pandemic has affected a person or household financially differed by employment status, age and ethnicity.

Higher income households saw the biggest reductions in spending during the pandemic

Restrictions brought into place to curb the spread of coronavirus, and the changes in behaviours many people adopted due to the pandemic, meant that households did not spend as much in the last year as they would usually.

The highest income households saw a larger drop in spending than the lowest.

Reduced spending on restaurants and hotels, recreation and culture and transport contributed most to the decline in overall spending for all income groups.

The highest income households, whose working members were more likely to work in jobs that could be carried out from home, saw spending on housing, fuel, and power rise during the pandemic, while the poorest households saw spending in this area fall.

Higher income households saw the largest spending drops on non-essentials such as restaurants

Contribution to change in weekly household expenditure (%), by spending category and income quintile, UK, FYE 2021

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Data for contributions to change in weekly household spending by category and income quintile (XLSX, 19KB)

  1. All other contributions include alcoholic drinks, tobacco and narcotics, clothing and footwear, household goods and services, health, communication, education, miscellaneous and other expenditure.

Increased spending on food and non-alcoholic drinks had a larger impact on expenditure in the poorest households. Lower income households spent proportionally more in this area pre-pandemic, with spending in this area making up around 15% of total expenditure for poorest 20% of households, compared with 8% for the richest fifth in FYE 2020. In FYE 2021 this increased to 18% for the lowest income households, and to 12% for those on the highest incomes.

Falling demand for transport on the other hand contributed more to drops in spending among the richest fifth of households, with spending on international flights and personal vehicles both seeing large falls.

Much of reduced spending across all income groups was due to households not travelling abroad. Spending on international holidays (including accommodation, travel and food) accounted for half of reduced spending on average in the highest income households. Among lower income households, travel abroad accounted for a third of reduced spending.

Spending on holidays abroad accounted for half of spending falls in the highest income households

Contribution of holidays abroad expenditure to falls in total spending, by income quintile, UK, FYE 2021

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Data for contribution of spending on holidays abroad to falls in total spending by income quintile (XLSX, 19KB)

  1. Expenditure on holidays abroad includes international air travel, money spent abroad, hotels and self-catering accommodation abroad, and package holidays abroad.
  2. Caution must be taken when comparing exact amounts of spending changes for the poorest 20% as fewer than 30 reporting households spent anything on holidays abroad in FYE 2021.

Workers on lower incomes were more likely to have seen their income fall

While many households saw their spending fall dramatically during the pandemic, substantial changes in the economy meant that many also saw their income fall.

Workers on lower incomes were more likely to report decreases in income in the year to March 2021 compared to the previous financial year, with 42% of those on the lowest income reporting a decrease, compared with 31% for those on the highest incomes.

This could be because of the types of jobs in different income groups. During the first national lockdown in spring 2020, workers on lower incomes were more likely to be furloughed and less likely to be able to work from home than those on higher incomes.

Jobs at greater risk during lockdowns, because they were not likely to be classed as key worker roles or able to be carried out from home, were also lower paid on average than jobs that were less vulnerable during the pandemic.

People on higher incomes were also more likely to be paid in full if they were unable to work, compared with those on lower incomes.

Working adults on the lowest incomes were most likely to see a fall in household income in the year to March 2021

Economically active adults’ change in household income in FYE 2021 compared with FYE 2020, by income quintile, Great Britain

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Data for change in household income by income quintile (XLSX, 20KB)

  1. Responses to the question “Has your household income changed at all since the start of the coronavirus outbreak in the UK?”.
  2. Individuals are ranked by their equivalised household disposable income for financial year ending 2020, using the modified OECD scale.

Taking both the changes to spending and income into account, households typically saw lower levels of spending relative to income during the pandemic. However, higher income households saw a larger spending drop relative to their income than those on lower incomes, providing them with greater opportunity to save or ease financial pressures.

In all income groups, the proportion of households whose weekly spending exceeded weekly income fell in the last financial year compared with FYE 2020. However, among the poorest households, two-fifths (40%) still spent more than they had in disposable income (money available after income tax and national insurance contributions).

On average, spending among the poorest households was roughly equal to their disposable income in FYE 2021, while the richest households spent less than half the size of their disposable income.

Higher income households spent less money relative to their income than lower income households

Disposable household income to expenditure ratio, by income quintile, UK, FYE 2020 to FYE 2021

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Data for disposable income to spending ratios by income quintile (XLSX, 19KB)

  1. Analysis of spending and income from the Living Costs and Food Survey (LCF) is experimental, based on provisional data and subject to uncertainty. More detail is available in the measuring the data section.

Data from the Opinions and Lifestyle Survey (OPN) suggest that those on higher incomes were able to recover faster from the financial shocks of the first national lockdown.

Between April and June 2020, the proportion of people in different income groups using their savings to cover living costs varied, but from Summer 2020, those with an annual income under £20,000 were one-and-a-half times as likely to be using their savings than those on higher incomes.

Throughout the pandemic, those paid less than £20,000 were also between two and three-and-a-half times more likely to be furloughed than those on higher salaries.

Workers paid less than £20,000 were more likely than higher earners to be furloughed and use their savings to cover living costs

Percentage of workers that were furloughed and percentage that used their savings to cover living costs, by income group, Great Britain, April 2020 to July 2021

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Data for percentage of furloughed workers and percentage that used savings to cover living costs (XLSX, 22KB)

  1. Responses to the question "In the past seven days, how have your household finances been affected?".
  2. Share of employed or self-employed respondents who responded "I have been furloughed". This is a self-reported figure, Her Majesty's Revenue and Customs (HMRC) publish official Coronavirus Job Retention Scheme statistics.
  3. Share of the respondents who responded “I had to use savings to cover living costs”.

The self-employed, younger age groups and those of black and mixed ethnicity found it harder to make ends meet in the year to March 2021

As well as household income, characteristics such as employment type, age and ethnicity have affected how the pandemic has impacted individuals’ finances. During the pandemic, people’s ability to make ends meet increased, but this varied across different groups. For some, such as self-employed workers, the ability to make ends meet declined.

The self-employed were less able to make ends meet than before the pandemic, unlike the population as a whole

Proportion of people reporting that they found it “fairly easy”, “easy”, or “very easy” to make ends meet, Great Britain

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Data for percentage of people able to make ends meet (XLSX, 19KB)

  1. Responses to the question “Thinking of your household's total monthly or weekly income, how is your household able to make ends meet, that is pay your usual expenses?”.

Self-employed workers were more likely to see reduced hours throughout the pandemic

Throughout the pandemic, self-employed workers were consistently more likely to report reduced hours and reduced income than employees.

At the end of March 2021, as the third lockdown started to ease, 28% of self-employed workers continued to report reduced hours compared to just 5% of employees. Similarly, over a third (34%) reported reduced income compared to just 10% of employees.

Self-employed workers were also more than twice as likely as employees to report borrowing money during the pandemic, although this gap narrowed during the Summer of 2021, as restrictions were lifted. In the week to 1 August 2021, more than 7% of self-employed workers were using savings, compared with less than 3% of employees.

This may reflect self-employed workers’ higher likelihood of having significant savings to draw on. On average, more than three-quarters (76%) of self-employed households had enough financial assets to cover a 25% fall in their household employment income, and 61% could cover a 75% fall for three months.

Those of Black ethnicity were most likely to struggle paying bills

Previous analysis covering the period before the pandemic has highlighted significant inequality in income and wealth by ethnic group.

Between May 2020 and February 2021, those of Black ethnicity were the most likely to report falling behind with many bills (3%), and to find keeping up with bills a heavy burden (20%) – a higher proportion than in the whole population.

One in five people of Black ethnicity found keeping up with bills a heavy burden during the pandemic

Proportion of population finding keeping up with bills a heavy burden, experiencing real financial problems and falling behind with bills, by ethnicity, Great Britain, May 2020 to February 2021

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Data for percentage of people experiencing various financial pressures by ethnic group (XLSX, 19KB)

  1. Includes adults responding in person who are at least 16 years old and not in full time education.
  2. Only those with debt on bank accounts, credit or store cards or mail order catalogues, or who have hire purchase agreements or loans, or who are behind with bills were asked to what extent keeping up with payments was a financial burden.

Data from the Opinions and Lifestyle Survey (OPN) also suggest that ethnic minority populations have not recovered from the economic shocks of the pandemic as quickly as those of White ethnicity. From Summer 2020, the proportion of the White population using savings to cover living costs steadily declined, even through the early 2021 lockdown.

While the proportion of ethnic minorities using savings to cover living costs was similar to the White population during Summer 2020, this figure increased in the third national lockdown, and remained at a similar level (almost 7%) in early Summer 2021, compared with just 3% among the White population.

Ethnic minorities were also consistently more likely to report needing to borrow money or use credit throughout the pandemic.

Older age groups were better insulated against the economic impacts of the pandemic

Younger people were more likely to report financial pressures than older age groups, with people aged under 35 years most likely to find keeping up with bills a heavy burden (9%).

Labour market statistics show that younger people were more likely to be furloughed during FYE 2021, and those aged 16 to 24 years were particularly affected, experiencing a greater decline in employment rate compared to those aged 25 years and over.

However, over the last quarter (April to June 2021) there was a stronger increase in the employment rate for young people – suggesting that the reopening of parts of the economy has allowed young people to either return from furlough or find new work.

Older age groups held more savings in the run up to the pandemic.

The median balance on individual current accounts, savings and ISAs was more than six times higher for people aged 65 years and over compared to that of those aged 25 to 34 years in the ten months to February 2021, suggesting older age groups were better insulated from some of the financial hits of lockdown.

Measuring the data

The article draws on findings from the Living Costs and Food Survey, the Survey on Living Conditions, the Wealth and Assets Survey, and the Opinions and Lifestyle Survey. These surveys’ time periods, geographies and data collection methods all differ slightly.

Living Costs and Food Survey

The Living Costs and Food Survey (LCF) is a UK household survey designed to provide information on household expenditure patterns and food consumption.

The most recent LCF technical report covers methods and data collection up to financial year ending (FYE) 2020. For a more in-depth explanation of LCF processes and methodology, refer to the  FYE 2016 technical report.

Please note that the FYE 2021 data are provisional estimates that have not yet been processed as comprehensively as previous years. Moreover, the current datasets include 69% of the data collected in FYE 2021. Revised financial year end family spending data will be published in Summer 2022 and the ONS regular income and inequality bulletin will be published in January 2022.

During FYE 2021 respondents did not complete a face-to-face interview with questions on regular items of household expenditure and income details, instead respondents participated in telephone interviews. In addition, respondents were asked to provide copies of receipts (electronic or paper) for the two-week diary period; and interviewers recorded non-receipt based expenditure via additional regular telephone calls during the two-week diary period.

An additional housing tenure calibration control has been added to the calculation of weights in this provisional FYE 2021 dataset to adjust for changes in the demographics of the LCF respondents during the pandemic, following the switch from face to face to telephone collection.

The provisional FYE 2021 data have not been adjusted for outliers and do not include any partial households. ONS’ typical annual family spending adjusts for unusually high expenditure and income values (outliers).

Data reference tables are published alongside this report, these provide information on response, characteristics of the sample, confidence intervals and statistical significance testing. All spending estimates are rounded to the nearest £0.10.

Survey on Living Conditions

The Survey on Living Conditions (SLC) is a six-year wave survey that provides information on household income.

This analysis is based on 23,736 responses from individuals in Great Britain collected between April 2020 and March 2021, which have been linked to the previous wave of data collection (April 2019 and March 2020) where available.

As such, the SLC is able to look at how the situation has changed from one year to the next for a cohort of households.

Further information about the survey’s sampling and weighting are available in ONS personal and economic wellbeing bulletins sections on measuring the data and strengths and limitations.

Wealth and Assets Survey

Data collection for the eighth round of the Wealth and Assets Survey (WAS) is currently in progress and will cover the period April 2020 to March 2022. WAS data used in this release are based on over 12,000 individuals in Great Britain, aged 16 years or over and not in full-time education, who responded in person between May 2020 and February 2021.

To provide timely data, these early indicator estimates were produced before data processing or imputation. Estimates of financial assets should be treated with particular caution and may be updated in future releases. No formal significance testing has been undertaken at this stage.

More information on the WAS, how the data are collected, strengths, limitations, and appropriate uses is available in the WAS QMI.

In response to the coronavirus pandemic, the WAS changed from face-to-face to telephone collection. The full extent of the impact of this change is not yet known.

Opinions and Lifestyle Survey

Opinions and Lifestyle Survey (OPN) data used in this article are drawn from the survey’s weekly module that asks about the impact of the pandemic on day-to-day life. For the time periods covered in each module, please see our reference tables. For some analyses we have used pooled data covering several weeks, detailed in our reference tables.

The two-category ethnicity breakdown includes:

  • White: White British, White Irish, any other White background
  • Ethnic Minority groups: White and Black Caribbean, White and Black African, White and Asian, Any other Mixed ethnic background, Indian, Pakistani, Bangladeshi, Chinese, Any other Asian background, African, Caribbean, Any other Black/African/Caribbean background, Arab or Any other ethnic group.

The survey results are weighted to be a nationally representative sample for Great Britain, and data are collected using an online self-completion questionnaire. Individuals who did not want to or were unable to complete the survey online had the opportunity to take part over the phone.

The responding sample in the week 28 July 2021 to 1 August 2021 contained 5999 individuals (64% response rate). Survey weights were applied to make estimates representative of the population.

Further information on the quality and methodology of all surveys can be found in the measuring the data section of our previous personal and economic wellbeing releases.

View all data used in this article


  • Personal and economic well-being in Great Britain

    Estimates from multiple sources for personal and economic well-being to understand the economic impact of the coronavirus (COVID-19) pandemic on households in Great Britain from March 2020 to April 2021.