Across the country in June, inflation is at its highest for 40 years, but Sky News analysis of the latest ONS figures shows shoppers in London are facing price rises twice as high as those in Yorkshire.
Apart from London, prices in Wales and Northern Ireland have risen by more than 10% compared to June last year, higher than the overall national inflation figure of 9.4%.
Food prices have risen by less than services overall, and both significantly less than goods, but there is still a clear difference in how the prices of different types of goods rise in different nations and regions of the UK.
The ONS measures inflation by keeping a record of the prices of 730 foods, goods and services which are intended to be representative of what UK consumers spend their money on. The list, known as the ‘shopping basket’, is updated every year so that it remains relevant.
Part of the way to keep track of price changes is by visiting stores around the UK and recording prices seen on shelves, which are then published in full, including a weighting based on the type of store and how representative the item is. For example, the price of a major brand seen in many stores may be weighted more heavily than a private label version of the same item.
The figures we have analyzed only cover items found in stores, while the ONS also records a proportion of prices online and over the phone.
Significant costs such as petrol, energy and housing are also excluded from the release, so the figures are not directly comparable to headline ONS inflation. However, they do give an insight into the different costs of living that people face in different parts of the UK.
“Personal consumption habits really matter”
That doesn’t necessarily mean that people in places where prices have risen the fastest will be worse off.
Jack Leslie, senior economist at the Resolution Foundation, which specializes in inflation and wealth inequality, said “personal and local spending patterns really matter.”
“If you’re someone who lives in a small, energy-efficient flat in London who doesn’t own a car, your personal inflation rate will be much lower than someone who lives in a leaky mansion in the Scottish Highlands, because the energy price cap has gone up and you have to drive vices.
“There has been a long-term trend for housing and other living costs to rise in areas where wages are highest, so there are less differences in living standards between nations and regions than might appear on the surface. These figures contribute to that.
“But it’s not good news that these gaps are closing, it’s just that some places are doing worse than others. Everywhere is going to be hit really hard by the cost of living crisis. Nobody can escape it. People’s real incomes are falling and it’s causing a lot of stress and hardship and potentially pushing people into poverty.”
Figures released by HMRC on Tuesday show that while average wages have risen across the UK, prices have risen faster overall.
People still earn more in London than other parts of the country, at £2,556 a month compared to a UK average of £2,108 and less than £2,000 in the North of England, the Midlands, the South West and Northern Ireland.
But lower wage growth and higher living costs mean that there is not the same gap when it comes to living standards.
How much more is a pint in different parts of the country?
Our analysis also shows the price range of certain items in different nations and regions.
While there is only a five pence difference between the average price of milk in the cheapest part of the country compared to the most expensive (£1.28 for four pints of whole milk in the North West compared to £1.33 in the North East), there are greater differences when comes to things like alcohol.
A pint of draft bitters will set you back an average of £2.89 in the North West, but £1.50 more in London. It’s a similar story for wine and lager, while the cheapest whiskey – perhaps unsurprisingly – is found in Scotland.
Mr Leslie says regional differences in hospitality costs usually reflect differences in wages: “A big part of the cost of eating out would come from the cost of hiring the chef, the waiters and whoever works there.”
Other factors that make a difference to price changes at the local level include the amount of products imported versus what is made or grown locally, and the types of stores people are used to using.
Mr Leslie says that during the pandemic “people became less willing to go to the big supermarket, and there was more demand for local corner shops”, particularly in urban areas.
He added: “I expect that imported products have risen in price faster than non-imported ones, due to disruptions in supply chains and exchange rates.”
The Data and Forensics team is a multi-skilled unit dedicated to providing transparent journalism from Sky News. We collect, analyze and visualize data to tell data-driven stories. We combine traditional reporting skills with advanced analysis of satellite images, social media and other open source information. Through multimedia storytelling, we strive to better explain the world while showing how our journalism is done.
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