@resfoundation

The Resolution Foundation is an independent think-tank dedicated to lifting living standards in the UK.

 London
linktr.ee/resfoundation
Joined August 2009
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Earlier this week we found out that CPI inflation rose to 3.5% in September, the highest rate in almost a year. Higher fuel prices were the biggest contributor to the rise in inflation between August and September – and they have gone up again since the September CPI reading was taken.
Chart showing price per litre of road fuels: UK

ALT Chart showing price per litre of road fuels: UK

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Young PIP recipients are no more likely to report mental health and neurodivergent conditions than older groups, with the sole exception of autism. Those aged 16-24 are less likely to report depression than 25-54-year-olds; less likely to report anxiety than 25-44-year-olds ➡️ buff.ly/eYndkHn
Chart showing proportion of PIP recipients aged 16-64 who report the top ten most common conditions, by age band: England and Wales, May-June 2026

ALT Chart showing proportion of PIP recipients aged 16-64 who report the top ten most common conditions, by age band: England and Wales, May-June 2026

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Today's ASHE release provides us with a snapshot of the UK labour market from earlier this year. The data shows that the share of workers in low pay failed to fall the first time in 15 years. It also gives an indication of what might happen to the minimum wage next year. buff.ly/9lSX3C8
quote graphic Nye Cominetti, Principal Economist at the Resolution Foundation, said: “Low hourly pay in the UK has stopped falling for the first time in over a decade. This is the result of the minimum wage moving to a ‘hold steady’ phase after years of being ramped up. It remains the case however that the share of workers on low pay is vastly lower than it was a decade ago. “Today’s data may have implications for next year’s minimum wage. With hourly pay growth surprising on the upside, the minimum wage next year may be significantly higher than the forecast of £13.18 published by the LBC back in April. However, the LPC now have more wiggle room on setting minimum wage rates, so the final number will come down to their judgement.”

ALT quote graphic Nye Cominetti, Principal Economist at the Resolution Foundation, said: “Low hourly pay in the UK has stopped falling for the first time in over a decade. This is the result of the minimum wage moving to a ‘hold steady’ phase after years of being ramped up. It remains the case however that the share of workers on low pay is vastly lower than it was a decade ago. “Today’s data may have implications for next year’s minimum wage. With hourly pay growth surprising on the upside, the minimum wage next year may be significantly higher than the forecast of £13.18 published by the LBC back in April. However, the LPC now have more wiggle room on setting minimum wage rates, so the final number will come down to their judgement.”

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🚨 Subastack latest: Jackdaw is a distraction from Aberdeen’s much bigger problem @JMarshall_3 and @zackleather argue that the Government needs a more place-centric approach to shore up Aberdeen’s labour market. ⬇️ buff.ly/PkvIKOa
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Extending the Fuel Duty freeze should not be a Budget priority. It is not well targeted (higher-income households spend more proportionally on petrol) and fuel costs are still below historic highs. At a time of constrained public finances, regular fixed increases would be a more credible policy 👇
CHart showing Nominal main rate of Fuel Duty per litre, by policy scenario: UK

ALT CHart showing Nominal main rate of Fuel Duty per litre, by policy scenario: UK

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Energy bills are set to rise again in January. This jump will land at the coldest time: 46 per cent of domestic gas use takes place in the first quarter of the year.
Chart showing Historical and forecast annualised default tariff cap levels, direct debit customers with typical consumption

ALT Chart showing Historical and forecast annualised default tariff cap levels, direct debit customers with typical consumption

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Lower net migration is set to hit fiscal headroom in the upcoming Budget.
Chart showing Shortfall in receipts relative to Spring Forecast due to estimated lower net migration: UK

ALT Chart showing Shortfall in receipts relative to Spring Forecast due to estimated lower net migration: UK

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Yesterday we found out that low-income private renters face record gap between the rents they pay and Local Housing Allowance The latest data confirms the 'affordability' gap between rates of Local Housing Allowance & local rents has reached an all-time high just a week before the Budget.
quote graphic Hannah Aldridge, Senior Research and Policy Analyst at the Resolution Foundation, said: “The affordability gap between the 30th percentile rent level and Local Housing Allowance has now reached a record high. Without urgent government action this gap will keep growing and pushing down on the living standards of low-income families in the private rented sector. “John Healey’s first Budget next week is an opportunity to fix this once and for all by committing to automatically linking LHA to private rent levels each year. “Previous Resolution Foundation analysis suggests re-linking LHA would primarily benefit tenants, not landlords. And with rising energy bills bringing the cost of living back into focus, now is the right time to give hard-pressed households reassurance on future rent support.

ALT quote graphic Hannah Aldridge, Senior Research and Policy Analyst at the Resolution Foundation, said: “The affordability gap between the 30th percentile rent level and Local Housing Allowance has now reached a record high. Without urgent government action this gap will keep growing and pushing down on the living standards of low-income families in the private rented sector. “John Healey’s first Budget next week is an opportunity to fix this once and for all by committing to automatically linking LHA to private rent levels each year. “Previous Resolution Foundation analysis suggests re-linking LHA would primarily benefit tenants, not landlords. And with rising energy bills bringing the cost of living back into focus, now is the right time to give hard-pressed households reassurance on future rent support.

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A majority of PIP recipients undertake economically valuable or wellbeing-enhancing activities that they could not do without support. Close to half (47 per cent) report that the benefit enables them to do at least one "economically valuable" activity, including working, training or caring.
chart showing Proportion of PIP recipients aged 16-64 who report that PIP enables them to undertake various activities: England and Wales, May-June 2026

ALT chart showing Proportion of PIP recipients aged 16-64 who report that PIP enables them to undertake various activities: England and Wales, May-June 2026

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"I am really disappointed that since then we haven't actually made any progress" @Dhara__Vyas, CEO of @EnergyUKcomms, joined us on the latest episode of High Resolution to discuss the need to accurately target government support with the cost of energy. Listen in full here ⤵️ buff.ly/UJHHTFi
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Lower-income tenants urgently need support to catch up with rent rises. Unfreezing Local Housing Allowance could be funded from within the benefit system itself by increasing the UC taper which would, on balance, benefit the poorest households 👉 buff.ly/fnIp1IU
chart showing Average change in annual household income (after housing costs) as a result of unfreezing LHA and increasing the UC taper (2026-27 prices), by income vigintile: UK, 2029-30

ALT chart showing Average change in annual household income (after housing costs) as a result of unfreezing LHA and increasing the UC taper (2026-27 prices), by income vigintile: UK, 2029-30

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🚨 Book launch tomorrow 🚨 @arindube will join Ruth Curtice and Stephen Machin to discuss his new book 'The Wage Standard' Tickets are still available here ⬇️ buff.ly/PFFNoZ6
Event graphic Fixing broken labour markets What can the UK and US learn from each other? UK launch event for The Wage Standard by Professor Arin Dube Thursday 22 October 2026 4:00 pm - 5:00 pm

ALT Event graphic Fixing broken labour markets What can the UK and US learn from each other? UK launch event for The Wage Standard by Professor Arin Dube Thursday 22 October 2026 4:00 pm - 5:00 pm

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The UK has experienced the equivalent of 13 years’ worth of ‘normal’ inflation in five years. And the UK has been hit harder by the cost of living crisis than elsewhere. Read more ⤵️ buff.ly/QbGKuKU
Chart showing Headline consumer prices index: UK, US and euro area (July 2021=100)

ALT Chart showing Headline consumer prices index: UK, US and euro area (July 2021=100)

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PIP is paid regardless of employment status, in order to contribute to the additional costs of disability. But among recipients, costs and function aren't perfectly related. A third (34 per cent) report a mismatch between their level of limitation and whether or not they face extra costs.
chart showing Proportion of PIP recipients aged 16-64 who report higher and lower levels of limitation and whether or not they are estimated to face additional costs: England and Wales, May-June 2026

ALT chart showing Proportion of PIP recipients aged 16-64 who report higher and lower levels of limitation and whether or not they are estimated to face additional costs: England and Wales, May-June 2026

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Is the minimum wage to blame for falling youth employment? In our latest substack Nye Cominetti digs into the youth employment stats, and gives his recommendation for minimum wage uprating ➡️ buff.ly/cqnDY99
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🏘️ Housing latest: A week before the Budget, rent inflation data out today confirms that lower-income private renters face a record shortfall in support for their housing costs: £170 a month for a typical family in a two-bedroom home.
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Over 900,000 families on Universal Credit across Britain are paying more in rent than their LHA. The Chancellor must end the freeze in the Budget, or low-income tenants will face at least another 18 months of rent rises on top of what they've already borne. See who is affected ➡️ buff.ly/kpnmNt1

Welfare • Resolution Foundation

resolutionfoundation.org
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Find out more about the impact the LHA freeze is having on tenants and rents in our research from last month⬇️ buff.ly/bZGd54E

Saving private renters • Resolution Foundation

Local Housing Allowance (LHA), which caps how much support is provided through the social security system to low-income private renters, was last relinked to the 30th percentile of rents in April...

resolutionfoundation.org
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