JSNA – People – Cost of Living

Last Updated: May 2024

Cost of Living

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The cost of living is the amount of money needed to cover basic expenses in a certain place and time period. The Barnet Cost of Living Dashboard is an interactive tool that explores this topic through three major themes of cost, income, and impact.

Headlines Figures

  • The average net income in Barnet is £45,176, and this average varies across Barnet. Overall, 11.9% of children in Barnet are in relative low-income families.
  • In 2022, the ratio of median-house price to median gross annual workplace-based earnings was 17.6 in Barnet – this is a higher ratio than both the London and England average.
  • Rent affordability in London varies by income quartile, with those in the 25th income percentile in London paying 57% of their monthly household income on rent whereas those in the 75th income percentile pay 22%.
  • The number of unemployment benefit claimants in Barnet reached its peak in March 2021. Overall, there has been a 2.6% increase from 2016 to 2023. As of August 2023, just over 32,000 households are on Universal Credit.
  • 11.5% of households in Barnet are fuel poor, meaning that they cannot meet their energy needs at a reasonable cost.

Narrative

Inflation: The annual inflation rate hit a peak of 9.6% in October 2022. As of November 2023, this rate has decreased to 4.2% but this is still 3.5% above the inflation rate seen in January 2016.

Employment: Between 2016 and 2021 in Barnet, the median annual salary for men was approximately £6,020 higher than that for women on average. In London, the gender pay gap was more pronounced, with men earning £9,570 more annually than their female counterparts. The number of unemployment benefit claimants in Barnet reached its peak in March 2021, experiencing a 2.6% increase on average from 2016 to 2023.

Housing: Between 2016 and 2023, the median house price in Barnet has increased by £160,000. As a result, houses are becoming less affordable. In 2022, the ratio of median-house price to median gross annual workplace-based earnings was 17.6 in Barnet – this is a higher ratio than both the London (12.5) and England average (8.3). Mortgage rates have increased over time, with 3 year fixed-rate bond deposits increasing by 3.8% between 2021 and 2023 and 10-year (75% LTV) mortgage rates increasing by 2.2% in the same time period. Rent costs have also increased and rent affordability in London varies by income quartile, with those in the 25th income percentile in London paying 57% of their monthly household income on rent whereas those in the 75th income percentile pay 22%.

Energy: In 2023, the annual inflation rate of electricity, gas & other fuels was 27.2% – this is a decrease compared to 2022 but is still 21.9% higher than the rate seen in 2021. Furthermore, between 2016 and 2023, the price of heating oils increased by £470 per 1,000L. These rising costs have greatly contributed to the cost of living. Compared to the higher income households, payment for the price of electricity, gas & other fuels has been the greatest driver of a rise in cost of living for low-income households in UK since 2021.

Food: Payment for food & beverages was the second highest pressure point for low-income households compared to higher income households in UK due to rising costs. In 2021/22, the average weekly expenditure spent on food & non-alcoholic beverages was £71.50. Foodbank usage have been rising steadily in Barnet, with an increase of over 29,000 users between 2021 and 2023.

Impact: Analysing the trend in Universal Credit claimants served as a key indicator for assessing the impact of the cost of living on Barnet residents. The peak in the number of households receiving Universal Credits occurred around April 2021 across all regions—Barnet, London, and England—followed by a subsequent decline for a year, only to rise again, surpassing the April 2021 peak. This unequivocally illustrates the substantial impact of the cost of living on residents, with Barnet experiencing a more significant impact compared to the averages for London and England. The average number of households on Universal Credits in Barnet between 2016 and 2023 was 15,873, exceeding both the London (13,716) and England (6,492) averages.

Children: To identify areas with a higher concentration of one of the most vulnerable groups affected by the cost of living, we examined the proportion of children in low-income families across lower super-output areas in Barnet. Burnt Oak emerged as the area with the highest percentage, with 22.4% of children living in low-income families, while Garden Suburb had the lowest at 2.5%.

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