Household incomes return to pre-recession levels


The average household income in the UK has now returned to the pre-recession level, according to figures released by the Office for National Statistics (ONS). It is now estimated at £25,700 - £1,500 higher than 2012/13 levels after accounting for inflation and household composition.

The report suggests that the recent increase in disposable incomes has been driven largely by higher household income from employment, due to both average earnings growing in 2014/15 and continued growth in employment rates.


The average income of the richest fifth of households fell the most following the economic downturn (7.9% between 2007/08 and 2012/13). Since then it has increased, but in 2014/15 remained £2,000 (3.2%) below its previous peak after accounting for inflation and household composition.

The poorest fifth of households were the only group whose average income did not fall between 2007/08 and 2012/13 - and in 2014/15 the average income of this group was £700 (5.8%) above its 2007/08 value. The increase for the poorest fifth was mainly due to an increase in the average income from employment for this group, along with an increase in the average amount received in certain cash benefits, such as tax credits and Jobseeker’s Allowance. Despite this, many have been struggling, with accessing support a particular problem among vulnerable people.

Retired households were largely unaffected by the economic downturn and their disposable incomes rose by 7.7% (£1500) between 2007/08 and 2014/15. In contrast, the median income for non-retired households decreased, and was £2,600 lower in 2012/13 than in 2007/08. Since 2012/13, the value of the median for non-retired households has risen to £28,300, but is still around £900 below 2007/08 levels (£29,200).

Low income families still struggling

Research carried out by Turn2us in 2015 found that 83% of low income households have seen no sign of their financial situation improving. Crucially, households that experienced a major change in their circumstances, such as divorce or illness, are now twice as likely to be struggling financially.

The research also suggests that despite the increase in disposable income, since 2008 the proportion of households unable to maintain an acceptable standard of living has risen by nearly a third.  

Turn2us help

If you are in work but on a low income, there may be benefits, grants or other financial support available to you. The ‘In work - on a low income' section of the website has information about ways you might be able to get help. This includes information on Working Tax Credit.

If you are struggling financially, you can also use our Benefits Calculator to check your entitlement to benefits and our Grants Search to see if you are eligible for help from a charitable fund, based on your personal circumstances and needs.

The Your Situation section on our website contains information resources on benefits and grants and a Find an Adviser tool to help you find face to face advice in your local area.

Source: Office for National Statistics - Household disposable income and inequality, financial year ending 2015 (Not available at present online)