As the vaccine rollout continues, attention has shifted to how quickly the UK’s economy can bounce back from the Covid-19 pandemic. According to the Bank of England, this might happen sooner than initially expected – households in the UK have accumulated £150 billion of Covid-savings that will now help fuel the recovery.2

However, the pandemic and the measures put in place to fight it have not affected all households in the same way. Lockdowns, the closure of shops and restaurants, plus the guidance to work from home have undoubtedly resulted in accumulated savings for some. But more than a third of the UK’s adult population has seen their income negatively impacted – more than 1.4 million people have started claiming unemployment-related benefits while 13 million have received help through the Coronavirus Job Retention Scheme or the Self-employment Income Support Scheme.3

And, as previous work by Centre for Cities shows, the pandemic has disproportionately affected some places more than others.4 Urban areas in particular have been hit hard – they are home to 55 per cent of the population but account for 66 per cent of the increase in people claiming unemployment-related benefits since the pandemic started. Cities are where problem debt concentrates. Before the pandemic, 65 per cent of all County Court Judgements (CCJs) occurred in urban areas.5

As such, the £150 billion Covid-savings boom is unlikely to be distributed evenly across the country, with many people now worse off. This will have implications for how quickly different places will be able to recover.

The purpose of this paper is to investigate these trends and analyse how the pandemic has affected spending, savings and debt in the UK’s largest cities and towns. It looks at what this means for policymakers, at the national and local level, as the country moves towards economic recovery.

Box 1: Defining cities

Centre for Cities’ research focuses on the UK’s 63 largest towns and cities, defined as primary urban areas (PUAs). Unless otherwise stated, Centre for Cities uses data for PUAs in its analysis – a measure of the ‘built-up’ area of a large city or town, rather than individual local authority districts. In this report, PUAs are used in the analysis because they provide a consistent measure with which to compare concentrations of economic activity across the UK. This makes them distinct from city region or combined authority geographies.

You can find the full definitions and methodology at: www.centreforcities.org/puas


  • 2 www.bloomberg.com/news/articles/2021-03-24/boe-s-chief-economist-says-rip-roaring-recovery-is-possible
  • 3 www.gov.uk/government/collections/hmrc-coronavirus-covid-19-statistics#self-employment-income-support-scheme
  • 4 Centre for Cities (2021), ‘Cities Outlook 2021’, London: Centre for Cities
  • 5 CCJs are a type of court order that is made against a person if they fail to repay money they owe, and their incidence is an indicator of problem debt.