PwC Consumer Sentiment Survey - Autumn 2025

Consumer sentiment remains steady

Net confidence – the difference between those expecting to be better off next year and those expecting to be worse off – has flatlined at -5 over the last three months. That’s better than the long run average but remains just below the highs seen in early 2024 and directly after the last election.

This apparent stability masks some shifts across different demographics. Since summer, sentiment among 25–34 year olds has dropped, reflecting concerns about job prospects and job security. Sentiment is also lower among more affluent households, possibly due to concerns about November’s Budget and potential tax hikes. But these falls are offset by gains in other groups. Pensioners, for example, are more optimistic than this time last year, following the reinstatement of the Winter Fuel Allowance for many. Overall, the gap between demographic groups has narrowed, suggesting a more unified consumer outlook.

Are consumers expecting to be better or worse off?

How consumers expect their household disposable income to change over the next 12 months, compared to the past year

Households are planning to cut back

The majority (85%) of consumers say they are concerned about the rising cost of living, with every demographic more worried than they were at the start of 2025. Although inflation has fallen to a fraction of what it was two years ago, the 'sticker shock' of infrequent purchases and the steady rise of essentials, such as food and everyday bills, are keeping concerns top of mind.

Food inflation took longer to fall and is now rising faster than overall inflation

Consumer Price Inflation, annual growth, 2021-2025

Since the start of the year, job security has become less of a concern for most, though it’s risen sharply among under 25s and lower skilled workers, who are most affected by job cuts and reduced hiring due to labour cost headwinds.

These pressures are causing consumers to rethink their spending habits. Across most demographics, but especially younger and lower-income groups, more people now expect to reduce their expenditures than three months ago. Around a third (35%) plan to choose cheaper items at the same stores and a quarter (26%) say they’ll shift some or all their grocery shopping to lower-cost retailers, signalling a return to the trading down behaviour that retailers saw at the height of the cost-of-living crisis. Meanwhile 28% intend to go out less, compounding the challenges faced by the hospitality and leisure sector.

Concerns about the cost of everyday essentials are rising

Proportion of adults concerned about the cost of everyday essentials over the next 12 months, January-September 2025

All age groups are planning to cut back their spending

Percentage of consumers planning to cut back their spending in the next three months by age group

Savings could fuel a rebound in consumer spending

Our September Economic Update reveals UK consumers have a higher savings ratio than before the pandemic, with a higher increase in savings than other G7 countries. This means that while some households have the capacity to spend, they are choosing instead to save as concerns about inflation, job security and potential higher taxes persist.

If these worries continue, consumers are likely to keep saving rather than spending, especially on discretionary and big ticket items. But if confidence in the economic outlook improves, there could be a release of pent-up spending power into the economy. Ultimately, it’s sentiment that will determine whether these savings are unlocked.

Opportunities ahead in the golden quarter

Consumers are cautious about Christmas spending and have told us that they are starting their shopping later than last year. More people say they’ll spend less than more this Christmas, with the cost of living cited as the number one reason.

But our research also reveals consumers typically spend more than they say they will. And with a savings buffer in place, Christmas could still be better for retailers than last year if the government and businesses can allay concerns and give shoppers confidence to spend.

For consumers who plan to trade down, it means reassuring them about value and offering quality lower cost options. For those planning to go out less, it means providing strong at home alternatives such as “dine in” deals, maintaining premium ranges for special occasions, and ensuring out of home experiences feel truly worth it.

Where different groups are focusing their spending

Net spending intention over the next 12 months, September 2025

There are also some key variations between how different groups prioritise their spending, which brands and retailers can tap into. For example, categories such as technology and fashion are lower priorities overall but remain higher priorities for younger shoppers.

Brands and retailers can take advantage of these opportunities to unlock spending during the Golden Quarter, a period that is critical for this sector. PwC will continue to track these dynamics and how consumers feel about their spending, with further insights and trading results to follow in our Retail Briefing in the new year.

This research is based on a nationally representative survey of 2071 adults conducted between 19 - 22 September 2025.