PwC: consumer confidence hits highest level in year, despite inflation and job security concerns

Consumer confidence in the UK has reached its highest level in a year, despite lingering concerns around job security and inflation, according to new data from PwC.

PwC surveyed 2,073 adults in the UK between 1st and 3rd July 2025 for its Consumer Sentiment Survey. It found that consumers overall are feeling more confident this summer, although this sentiment was concentrated into two demographics: 25-34 year olds and those in the highest socio-economic bracket. 

These two groups were the only segments that felt more optimistic compared to the same time last year. PwC says these two groups were some of the only segments to see household finances improve in the last 12 months.

Jacqueline Windsor, Head of Retail at PwC UK, says: “The retail and hospitality sectors have had a relatively strong start to 2025 particularly given wider economic uncertainty, with non-food retail sales volumes in particular recovering after a challenging two to three years. It is a relief for consumer-facing businesses that overall consumer sentiment has started to move in a positive direction.”

“However, the extent to which consumers are being cautious in their spending as we go into the critical second half of the year remains a concern, with inflation and job security weighing on purchasing decisions.”

Concerns around job security and inflation has increased across all age groups, as 84% of consumers say the “rising cost of everyday things” is a worry and 39% report job progression as a concern.

Younger demographics were more concerned about their job prospects, with 60% of 18- to 24-year olds reporting this as a worry, up from 49% at the start of the year. 

Sam Waller, Leader of Industry for Consumer Markets at PwC, says: “While sentiment has improved since the spring and stopped declining, the contrast of those feeling the most and least optimistic is split demographically with the majority of the population - while slightly more upbeat that earlier this year - still feeling worse off compared to this time last year.” 

“Businesses in the consumer industry will need to be agile and pivot their offerings to target their more confident customers given the current economic backdrop and how hesitant some consumers are about discretionary spending.” 

While overall consumer spending intentions softened across most categories, consumers made exceptions for groceries, with 46% planning to spend more here. Children and pets were the next most common priority for consumers, followed by holidays, with 21% intending to spend more on trips in the next 12 months. 

For over 65s, holidays were the highest spending category after groceries and pets, while consumers aged under 35 were more likely to prioritise spending on fashion, health, wellbeing and beauty. Young people were more likely to say they intended to increase their spending on these products than decrease spending in these areas.

2025 RTIH INNOVATION AWARDS

Grocery retail will be a key focus area at the 2025 RTIH Innovation Awards.

The awards, which are now open for entries, celebrate global tech innovation in a fast moving omnichannel world.

Our 2024 hall of fame entrants were revealed during an event which took place at RIBA’s 66 Portland Place HQ in Central London on 21st November, and consisted of a drinks reception, three course meal, and awards ceremony presided over by comedian Lucy Porter.

In his welcome speech, Scott Thompson, Founder and Editor, RTIH, said: “The event is now into its sixth year and what a journey it has been. The awards started life as an online only affair during the Covid outbreak, before launching as a small scale in real life event and growing year on year to the point where we’re now selling out this fine, historic venue.”

He added: “Congratulations to all of our finalists. Many submissions did not make it through to the final stage, and getting to this point is no mean feat. Checkout-free stores, automated supply chains, immersive experiences, on-demand delivery, next generation loyalty offerings, inclusive retail, green technology. We’ve got all the cool stuff covered this evening.”

“But just importantly we’ve got lots of great examples of companies taking innovative tech and making it usable in everyday operations - resulting in more efficiency and profitability in all areas.”

Congratulations to our 2024 winners, and a big thank you to our sponsors, judging panel, the legend that is Lucy Porter, and all those who attended November's gathering. 

For further information on the 2025 RTIH Innovation Awards, please fill in the below form and we will get back to you asap.