Confidence in the UK economy has fallen to its lowest level in nearly half a century, as households grapple with rising costs and global uncertainty.
A new survey released Wednesday by Ipsos shows that British consumers are more downbeat than at any point since records began in 1978. The firm’s Economic Optimism Index — which tracks the balance between positive and negative expectations — plunged to a record low of -72 this month.
The sharp decline reflects mounting anxiety over the economic fallout from escalating tensions in the Middle East, particularly the impact of higher oil prices. These pressures are adding to a series of shocks that have weighed on households in recent years, from the COVID-19 pandemic and Brexit to persistently high inflation.
The latest reading surpasses the previous low of -68 recorded a year ago, when global trade tensions intensified following tariff measures introduced by the United States. More strikingly, current sentiment is now worse than during the 2008 global financial crisis and the recession of the 1980s.
The findings present a significant challenge for Prime Minister Keir Starmer ahead of local elections scheduled for early May. Analysts suggest that economic concerns could play a decisive role at the ballot box, as voters continue to feel the strain of rising living costs.
Despite official data indicating that the UK economy showed solid growth in the months leading up to the latest geopolitical tensions, investors remain wary. Britain is widely seen as particularly exposed to fluctuations in energy prices, amplifying concerns about the outlook.
The Ipsos survey aligns with other recent research pointing to growing unease. A report by Citi and YouGov last month highlighted a sharp increase in inflation expectations among consumers.
“Concern about the state of the economy is widespread across all groups,” said Gideon Skinner, senior director of UK politics at Ipsos, noting that such sentiment could heavily influence upcoming elections.
Only 6% of respondents said they expect the economy to improve over the next year, underlining the depth of pessimism.
The survey was conducted between April 8 and April 14 among 1,003 adults across the UK. Photo by Lars Frantzen, Wikimedia commons.
