This is marginally higher than the 21% and 22% of people who expected to be better off in the following 12 months in 2016 and 2015 respectively, and is thought to be largely due to falling unemployment and the introduction of the National Living Wage.

However consumers least likely to have seen wage increases, between the ages of 45 and 64, are the most pessimistic about their prospects this year, often citing the economy as the reason for thinking they will be worse off.

PwC director, Kien Tan, said: “Our survey results reflect the fact that many consumers’ personal circumstances have been improving in the past year, with falling unemployment and the National Living Wage being reflected in many people’s pay packets.

“However, breaking down the figures in more detail, for the first time, those in the 45-54 and 55-64 year old age groups were the most pessimistic, with 31% and 34% expecting to be worse off next year respectively. 

“This marks a departure from our previous surveys where the 65+ age group has historically been the most pessimistic.  Indeed, there has been a marked deterioration in sentiment amongst the 35-44 and 45-54 year olds since our September survey.

“These ‘pressured families’ are least likely to have benefited from wage and pension increases, and most likely to have been affected by inflation on fuel and holidays.”

Trends in consumer sentiment since 2008 are summarised below:

The PwC research involved surveying over 2,000 consumers across the UK, and in addition to asking about disposable income, breaks down exactly where people expect they will spend their money over the next year.

It was found that people are less likely to spend their wages on almost all areas of outgoings such as holidays, nights out, clothing and household goods.

The only category where consumers expect to spend more is on groceries, with 81% of people who said they would have to spend more on essentials citing inflation as the reason.

PwC partner, Lisa Hooker, said: “This will set a challenge for retailers and leisure operators across different categories who will need to adapt their strategies in order to encourage consumers to keep spending with them, even if they plan to buy less overall.”