Living Standards

Key statistics

Tracking these impacts will take time, as data is released with a significant lag, but all the indicators point to these impacts being greatest for Londoners with the lowest incomes. What we already know is that:

  • Overall, more than 1.54 million working-age Londoners were claiming benefits in August 2020, a rise of 44% compared to August 2019.
  • In August 2019, 19,395 people were subject to a cap on their benefits, growing to 53,048 people a year later.
  • In the six months to September 2020, London food banks distributed more than 210,000 food packages, a 128% increase compared comparable data in the same period in 2019.
  • Government policy has protected many people - for example, in 2019, 1,136 people were seen sleeping rough on a single night in London. By autumn 2020, as a result of the government’s action, that had fallen by 59% to 714.

The pandemic has increased pressures on Londoners:

  • Overall, Londoners with children spent 15.6 hours a week on homeschooling and childcare in April 2020.
  • Women spent more time than men on homeschooling and childcare, spending an average of 19.1 hours a week on these activities.
  • Levels of happiness, feeling worthwhile and life satisfaction have fallen across the capital. In winter 20/21, anxiety scores were 44% higher than pre-pandemic levels.

The combined health, economic and social impacts of the pandemic have taken a significant toll on the living standards of Londoners.

Poverty was a serious issue in London prior to the pandemic

Prior to the pandemic, 27% of Londoners were living in poverty, significantly more than any other part of the UK. Poverty rates in Inner London were even higher (30%), and at least five percentage points higher than in many parts of the North of England.[1] Among some groups the poverty rate was even higher still; for example, in 2018/19, the BME poverty rate in London was 39% and for single parents it was 54%.[2] Poverty rates also varied significantly across London’s boroughs.

Londoners, and particularly Londoners on lower incomes, were also more likely to have lower life satisfaction, suffer from higher levels of anxiety,[3] be materially deprived, and lack the savings and assets they need to protect them against income shocks.

Before the pandemic:

  • 27% of Londoners were living in poverty, significantly more than any other part of the UK.
  • 39% of BME Londoners were living in poverty, nearly twice the rate of white groups (21%).
  • 22% of Londoners reported high levels of anxiety, while 26% said they have only low or medium happiness.

The previous sections have shown that the impacts of the pandemic are likely to have made all of these issues worse – and by a greater extent – for those Londoners with the lowest incomes.

More Londoners are now relying on benefits to make ends meet – but the benefit cap is starting to bite

Overall, more than 1.54 million working-age Londoners were claiming benefits in August 2020 (a rise of 44% compared to August 2019). There were 840,927 working-age women claiming some form of working- age benefit (an increase over the year of 33%), compared to 702,862 working-age men (a 58% increase).

Figure 22: Number of Londoners aged 16-64 on benefits (August 2014 - August 2020)

In part a result of the significant increase in the number of people on out-of-work benefits, but also a reflection of the government’s decision to increase the value of Universal Credit by £20, the number of people subject to the benefit cap has more than doubled over the same period. In August 2019, 19,935 people were subject to a cap on their benefits within London, and this had grown to 53,048 people a year later.

Figure 23: London households affected by Benefit Cap (August 2013 - August 2020)

Pressures of housing costs have eased for some

LPP data from before the pandemic shows the significant impacts that housing costs have on poverty in London. On average, households that were not in poverty in London spent 13% of their net income on housing costs, compared to 9% in the rest of England. The situation is even worse for London households in poverty, who on average spent 56% of their net income meeting housing costs.[4] At the most extreme end of this housing challenge, 10,726 people were seen sleeping rough in the capital prior to the pandemic.[5]

In each of these areas, the pandemic and associated government responses have provided at least a little respite. For example, recent analysis for the LPP has shown that in many parts of Inner London, typical rents for two-bed properties in the private rented sector fell over the course of 2020. However, in Outer London, despite the significant economic impacts of the pandemic, many areas have seen significant rises in rental costs, putting further pressure on already squeezed incomes.

Change in Median Monthly Rent for 2-Bed Private Properties (2019-2020)

The government has also legislated to ensure that in most cases, landlords cannot serve eviction notices to tenants who are behind with their rent. This led to a large reduction in repossessions in 2020 (falling from 8,639 in 2019 to 1,919 in 2020).

Figure 25: Types of court repossession in London (2003 - 2020)

In March 2020, the government also launched the Everyone In programme, working with councils, homelessness charities and hotel chains to accommodate people who were sleeping rough or at risk of sleeping rough during the pandemic. The effect of that is likely to be reflected in the fall seen in the annual count of rough sleepers that takes place every autumn. In 2019, 1,136 people were seen sleeping rough on a single night in London. By autumn 2020, that had fallen by 59% to 714.[6] A similar proportional fall was seen in the rest of England.

More Londoners are now relying on foodbanks

Despite respite for some Londoners from the pressures of housing costs, another clear sign of the financial pressures that the pandemic has placed on families is the number of people having to rely on food banks to put food on the table. In the six months to September 2020, food banks run by members of the Trussell Trust network in London distributed 210,000 food packages to people in the capital, a 128% increase compared to the same period in 2019. The increase in the rest of England was 56%, demonstrating the severe financial pressures being placed on families in the capital.

Figure 26: Food packages distributed by food banks to adults and children (April-September 2019 and April-September 2020)

The pandemic has also increased pressures on many people

As well as significant financial pressures, the pandemic has also placed other pressures on families. For example, during the periods of the year when schools were forced to close, many Londoners had to juggle homeschooling, childcare and work. Overall, Londoners with children spent 15.6 hours a week on homeschooling and childcare in April 2020. Women spent more time than men on homeschooling and childcare, spending an average of 19.1 hours a week on these activities.

Figure 27: Average hours spent on homeschooling and childcare (April 2020)

More broadly, the pandemic has put further pressures on those already struggling with insecure and low-paid work. Before the pandemic, 8.9% of workers in London were in insecure employment (e.g working through an agency, on a temporary contract or in an insecure profession), 0.5 percentage points higher than the UK as a whole.[7] These workers have been hit hardest by the pandemic, being 1.5 times more likely to have been made redundant and seven times more likely to be threatened with redundancy than workers who aren’t in insecure employment.[8] At the same time, insecure workers are at greater risk of infection from COVID-19, with 34% shielding or at heightened risk of the disease.[9] These figures are particularly concerning given 52% of people in insecure work are key workers.[10]

The pandemic has significantly impacted on the wellbeing of Londoners

Given the range of other impacts the pandemic has had, it is no surprise that Londoners’ wellbeing has been negatively impacted too. Levels of life satisfaction, feeling worthwhile and happiness have all fallen, and levels of reported anxiety shot to a record high in 2020. Across the country, those who were in a worse situation before the pandemic were hit hardest by COVID-19. Between April and May 2020, people whose household finances were negatively affected by the pandemic were over two times as likely to be experiencing high anxiety.[11] Disabled people and women have both been over 1.5 times as likely to report high anxiety during the pandemic.[12]

While these effects have been seen across the whole of the UK, in London they come alongside the fact that, in both 2018/19 and 2019/20, the capital already had lower levels of happiness, life satisfaction and feeling worthwhile and higher levels of anxiety than the rest of the country.[13]

Figure 28:Levels of happiness, life satisfaction and feeling worthwhile in London (2011/12 - Winter 2020/21)

Figure 29: Anxiety levels in London (2011/12 - Winter 2020/21)

Note: The winter 2020/21 data has been taken from a different series that has not been seasonally adjusted

ENDNOTES

[1] ‘Households Below Average Income’, 2019/20, Department for Work and Pensions (DWP). Three-year averages have been used to ensure sufficiently large sample sizes.

[2] ‘Households Below Average Income’, 2018/19, DWP. Three-year averages have been used to ensure sufficiently large sample sizes.

[3] Wellbeing estimates by local authority and Opinions and Lifestyle Survey (COVID-19 module), ONS.

[4] London’s Poverty Profile 2020, Trust for London.
Available at: trustforlondon.org.uk/publications/lpp2020/ (accessed 11 April 2021).

[5] 2019/20 figure of people sleeping rough known to outreach workers. ‘CHAIN Annual Report, Greater London, April 2019-March 2020’, Greater London Authority (GLA).
Available at: data.london.gov.uk/dataset/chain-reports (accessed 12 March 2021).

[6] ‘Rough Sleeping Snapshot in England: Autumn 2020’, Ministry of Housing, Communities and Local Government.
Available at: www.gov.uk/government/statistics/rough-sleeping-snapshot-in-england-autumn-2020/rough-sleeping-snapshot-in-england-autumn-2020 (accessed 12 March 2021).

[7] ‘Insecure Employment’, GLA.
Available at: data.london.gov.uk/economic-fairness/labour-market/insecure-employment/ (accessed 12 March 2021).

[8] ‘On the Edge: Insecure work in the pandemic’, Citizens Advice.
Available at: citizensadvice.org.uk/about-us/our-work/policy/policy-research-topics/work-policy-research-surveys-and-consultation-responses/work-policy-research/on-the-edge-insecure-work-in-the-pandemic/ (accessed 12 March 2021).

[9] Ibid.

[10] Ibid.

[11] ‘Coronavirus and Anxiety, Great Britain: 3 April 2020 to 10 May 2020’, ONS.
Available at: ons.gov.uk/peoplepopulationandcommunity/wellbeing/articles/coronavirusandanxietygreatbritain/3april2020to10may2020 (accessed 1 April 2021).

[12] Ibid.

[13] ‘Personal Wellbeing by Local Authority’, ONS.
Available at:ons.gov.uk/datasets/wellbeing-local-authority/editions/time-series/versions/1 (accessed 12 March 2021).