Higher earners are bearing the brunt of rising costs as Labour’s campaign against Britain’s middle classes takes its toll, official figures reveal.
Wealthier households are seeing prices rise higher than poorer ones for the first time since March last year, while workers are suffering more than retirees with the rising cost of living – according to data published on Friday by the Office for National Statistics (ONS).
Britons, meanwhile, have grown steadily more anxious since Labour came to power, separate data from the government body suggests.
This comes after former Chancellor Rachel Reeves demanded those with the ‘broadest shoulders’ pay their ‘fair share’, and introduced tax-raising measures in last autumn’s Budget, leaving higher earners worse off.
Prime Minister Andy Burnham last month pledged to create ‘breathing space’ for households struggling with the rising cost of living.
But higher earners are now being hit hardest by rising costs – with annual inflation increasing by 2.7 per cent for low-income households in the year to June 2026 and by 2.8 per cent for high-income households.
Retired households saw a 2.5 per cent rate of inflation compared to working households at 2.9 per cent in June this year. While annual inflation fell for both retirees and workers between March and June, the difference between the two groups increased by 0.4 percentage points.
Private renters experienced the highest annual inflation rate of 3 per cent in June, compared to social renters and homeowners. This comes as Britons are feeling more anxious than they did at any point since December 2023 according to a quarterly report on wellbeing published on Friday by the ONS.
Prime Minister Andy Burnham last month pledged to create ‘breathing space’ for households struggling with the rising cost of living
Women reported especially high rates of anxiety compared to men, with people aged 20 to 24 most likely to be feeling anxious.
Shadow Chancellor Sir Mel Stride said: ‘Under Labour, everything seems to be getting worse. The cost of doing business is up, the cost of living is up, and everyone is left carrying a bigger burden and more anxiety about covering the basics.’
Anne Strickland, from the TaxPayers’ Alliance, said: ‘Working households are being squeezed, with renters and non-retirees still hit hardest by rising costs.
‘The cost-of-living crisis is far from over for taxpayers who are funding a state that keeps demanding more.’
A Treasury spokesman said: ‘The Chancellor [John Healey] has taken immediate action to give families and businesses breathing space since his very first day in office – including removing VAT on electricity bills this winter, cutting business rates for pubs, clubs and live music venues by 20 per cent next year, and capping bus fares at £2 throughout 2027.’
