UK consumer confidence sees sharpest decline in nearly 3 years
British consumer confidence saw its steepest drop in almost three years during the second quarter of 2025, as concerns over job security, income growth, and persistent inflation weighed heavily on sentiment, according to Deloitte's latest consumer survey.
Deloitte reported that its consumer confidence index fell by 2.6 percentage points to 10.4%, marking its lowest level since early 2024. This is the first significant decline since the third quarter of 2022, a period marked by soaring inflation and financial turmoil following former Prime Minister Liz Truss' budget plans, News.Az reports, citing Reuters.
“Concerns of a slowing labour market have left consumers worried about job security and income growth prospects, while persistent inflation and a high cost of living have negatively impacted sentiment towards personal debt,” said Celine Fenech, consumer insight lead at Deloitte.
Businesses have cited higher employment taxes, April’s minimum wage increase, and planned legal reforms that make employee dismissals more challenging as reasons for reduced hiring. Official figures last week showed the unemployment rate rising to 4.7% for the three months to May – the highest since 2021 – while inflation hit 3.6% in June, the highest since January 2024.
Deloitte’s survey, conducted between June 13–16 among 3,200 respondents, measures sentiment across six key areas: job security, job opportunities, income, personal debt, children’s welfare, and general wellbeing.
Despite a 3.9-point improvement in perceptions of the economy, sentiment remains 18.4 points lower than a year ago. Deloitte’s findings contrast with GfK’s consumer confidence survey, which reported a gradual recovery last month to its highest level since December.
“Activity in the UK has slowed in recent months, but an uptick in business confidence seen in the latest Deloitte CFO Survey testifies to continued resilience amid geopolitical uncertainties,” added Ian Stewart, Deloitte's chief economist.
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