One in three Londoners suffer income drop during pandemic, study finds
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Almost one in three Londoners experienced a fall in income during the pandemic, the joint highest of any region in the UK, new data has shown.
The income pressure was driven by the disruption inflicted on retail and hospitality throughout the Covid crisis, according to research gathered by consultancy firm Lane Clark & Peacock (LCP).
Many firms in these sectors have used job protection schemes to offset cash shortfalls caused by restrictions on economic activity.
Pubs and restaurants employ a large amount of the capital’s workforce, meaning Londoners are more likely to have been furloughed or made redundant, LCP said.
Latest figures from HMRC shows London has had 1.6 million furlough claims through the Coronavirus Job Retention Scheme, more than any other UK region.
LCP’s research also noted the disparities in London’s labour market, with the capital having the joint highest proportion of people in any region to experience income gains during the pandemic.
The divergence could be a result of London’s high concentration of jobs in the professional and financial services industry, according to the research.
Heidi Allan, senior financial wellbeing consultant at LCP, said that income shocks have been felt harder by people living in areas where the cost of living is much higher than other regions.
“Londoners who have swallowed wage reductions are likely to be under intense stress due to the high cost of living in the capital making it more difficult for them to maintain their livelihoods.
“People working in industries that have been stifled by Covid prevention measures are likely to be struggling the most financially. This two-tier reality risks adding to existing income and wealth gaps across the UK.”