Surveys
Halifax Research Shows UK Affluent Earnings Outstrip Inflation

The earnings of "affluent" households in the UK have risen by 42.8 per cent over the past decade, more than double the 18.2 per cent rate of inflation for this group, according to new research from Halifax Financial Services. Halifax said the research demonstrates that, contrary to popular belief, affluent families have experienced only slightly higher than average Consumer Price Inflation over the past ten years. In 1997 the typical affluent class earnings were £25,126 ($50,000) rising to £35,875 over the following decade. Similarly, since 1997, affluent class earnings have risen by more than that for the typical worker – 42.8 per cent against 39.5 per cent. Education has been the fastest growing price category in the CPI over the past year (14 per cent), five years (42.4 per cent) and decade (87 per cent). These rapid rises primarily reflect increases in university tuition fees and private school fees. Affluent families typically spend the most on education, with average expenditure of £1,676 per year, accounting for five per cent of their total spending. In proportionate terms, this is two and a half times more than the average household, which spends two per cent of total spending on education (£317 per year). Housing is the spending category with the second strongest price increases over the past five years (28 per cent) and decade (41 per cent), mainly due to rising utility bills and rents. Affluent families spend more than a quarter more than the average household on housing in absolute terms - £2,692 a year against £2,142. Affluent families, however, spend less than three quarters as much as the average household as a proportion of their total spending – 8 per cent against 11 per cent. This has helped to keep affluent class inflation down. They also tend to spend more of their income than the average household on clothing, recreation and household goods. These categories have experienced either price falls, or very low inflation, over the past few years.