Nearly one in three Europeans fears a decline in personal living standards over the next five years amid persistent cost-of-living pressures, according to a new Eurobarometer survey, highlighting deep economic anxieties across the EU.

A fresh Eurobarometer survey reveals widespread concern among EU citizens about their economic future, with rising prices and inflation dominating public worries.

According to the poll conducted in June 2026 and involving over 26,000 respondents across the European Union, 29 per cent of Europeans believe their personal standard of living will decline over the next five years. Only 18 per cent expect an improvement, while the majority anticipate stability or remain uncertain.

This pessimism is more pronounced among older generations, with 34 per cent of those aged 55 and over expressing fears of deterioration, compared to just 17 per cent of younger respondents. Country-level variations are stark: France leads with 44 per cent expecting a worsening situation, followed closely by Portugal, Germany, and Austria. In contrast, optimism prevails in Central and Eastern Europe, with Poland at just 9 per cent and Hungary at 8 per cent expressing similar concerns.

The survey underscores a broader perception of economic fragility. Half of Europeans hold a negative view of their country’s economic situation, though many remain slightly more positive about their personal finances. Inflation, rising prices, and the cost of living top the list of issues citizens want the European Parliament to address, cited by 47 per cent – a six  percentage point increase from the previous survey.

Roots of the Cost-of-Living Crisis

Europe’s economic challenges stem from a series of compounding shocks. The lingering effects of the COVID-19 pandemic, Russia’s invasion of Ukraine, and subsequent energy market disruptions have fuelled inflation and eroded purchasing power. Although headline inflation has moderated to around 2.1 per cent in late 2025, many households continue to feel the pinch from elevated prices for food, energy, and housing.

Recent data from Eurofound’s 2025 Living and Working in Europe e-survey paints a picture of mounting financial strain. In low-income households, 61 per cent reported difficulties making ends meet in 2025, up sharply from 40 per cent in 2023. High-income groups fare far better, with only 9 per cent facing similar issues, highlighting a widening resilience gap.

Housing affordability has emerged as a critical pain point. Around 40 per cent of Europeans cite a lack of affordable housing as an urgent problem. Rising rents and property prices, combined with higher interest rates, have squeezed middle- and lower-income families, particularly in urban areas.

Consumer surveys reinforce this narrative. A BCG study found that 53 per cent of European consumers are worried about their daily personal finances in 2026, up from 40 per cent in 2024. Over half are actively cutting back on spending, prioritising essentials amid geopolitical tensions and energy price volatility.

Generational and Regional Divides

The survey exposes clear generational divides. Older Europeans, often more reliant on fixed incomes or pensions, feel the squeeze from inflation more acutely. Younger people, while concerned about jobs and housing, appear somewhat more resilient or hopeful, possibly due to labour market participation or different consumption patterns.

Regionally, Western European nations show higher pessimism, potentially linked to slower growth, higher debt levels, and greater exposure to global market fluctuations. In France and Austria, for instance, economic worries correlate with more skeptical views of EU membership benefits, where only 62 per cent see a net positive impact – the lowest in much of the bloc.

Eastern and Nordic countries, benefiting from stronger growth trajectories or robust welfare systems, report greater confidence. This divergence could influence EU policy debates, particularly around cohesion funds and economic integration.

Broader Economic Context and Policy Responses

Europe’s economy faces structural headwinds. The Eurochambres Economic Survey 2026 identifies high labour costs, regulatory burdens, and skills shortages as top challenges for businesses. These factors constrain investment and wage growth, perpetuating the cost-of-living squeeze.

OECD analyses note that while real wages have broadly recovered from the inflation surge, vulnerabilities persist for lower-income groups. Housing market adjustments remain orderly but carry downside risks, especially in high-debt countries.

EU institutions are under pressure to act. Citizens prioritise cost-of-living measures, economy and job creation, and defence and security. The European Central Bank has navigated rate adjustments, but tools are limited amid external shocks like geopolitical conflicts.

Proposals include targeted support for vulnerable households, investments in affordable housing, skills training, and measures to boost competitiveness. Simplifying regulations and enhancing the single market could help, but political fragmentation complicates bold action.

Political and Social Implications

Persistent economic anxiety is reshaping politics. Cost-of-living concerns often overshadow other issues like migration or climate in voter priorities, fuelling support for populist and eurosceptic parties in countries like France and Austria.

A 2023 Ipsos survey (with patterns persisting) found 29 per cent of Europeans in precarious financial situations, with many fearing further slippage – rising food bank usage, second jobs being common, and mental health strains – such as elevated depression risk.

Social cohesion is tested as inequality perceptions grow. While overall EU image remains positive for 50 per cent of citizens, economic discontent narrows this margin in key member states.

Not all indicators are negative

Despite the gloom, not all indicators are negative. Labour markets have shown resilience, unemployment remains relatively contained in many countries, and EU solidarity mechanisms provide buffers. Public support for common defence (81 per cent) and viewing the EU as a stabilizer (73 per cent) offer foundations for collective responses.

To reverse pessimism, the survey points out, policymakers must deliver tangible improvements in affordability, wages, and opportunities. Investments in green transition, digital economy, and strategic autonomy could foster growth that benefits broader populations.

As one EU official noted, economic uncertainty directly influences perceptions of the Union. Addressing the cost-of-living crisis is not just an economic imperative but essential for maintaining public trust and European integration.

Europe stands at a crossroads. With global uncertainties persisting – from energy markets to geopolitical tensions – the coming years will test the bloc’s ability to safeguard living standards. The Eurobarometer serves as a clear warning: ignoring citizens’ pocketbook concerns risks deepening divides and undermining the European project.