Early Christmas shopping and cinema trips boost UK consumer spending
Early Christmas shopping, more cinema trips and increased overseas travel boosted UK retail sales and consumer spending in October.
Retail sales increased 1.3 per cent compared with the same month last year, up from 0.6 per cent in September, according to data by the British Retail Consortium, a trade body, in association with the consultancy KPMG.
That is also 6.3 per cent above retail spending in October 2019, before the pandemic.
Helen Dickinson, BRC chief executive, said customer demand was “getting back on track ahead of Christmas” as “some people started their Christmas shopping early with beauty advent calendars flying off the shelves”. She added that more social events also boosted sales of clothing and footwear.
Retail sales rose despite spending on furniture and electrical sales being held back by global logistical problems and microchip shortages, the BRC said.
The figures ease some fears that rising inflation and energy prices would reverse the UK’s consumer rebound.
Paul Martin, UK head of retail at KPMG, said: “The much-reported squeeze on household spending has yet to materialise as consumers seem happy to carry on shopping.”
The figures chime with separate data from Barclaycard, the credit card business of Barclays bank, that reported UK consumer spending was up 14.2 per cent in October compared with the same month in 2019. Unlike retail sales, consumer spending includes services such as restaurants and entertainment.
Barclaycard data, based on nearly half of all UK credit and debit card transactions, showed that spending on entertainment was up 28 per cent in October. It was boosted by cinema bookings that rose above pre-pandemic levels for the first time as people flocked to see the launch of the new James Bond film, No Time to Die.
Separate data by Box Office Mojo showed that in the last weekend of October, when the movie was screened, UK box office revenues were 23 per cent above the same period in 2019.
Spending on international trips and public transport also recorded their strongest performance since before the pandemic began as more restrictions were lifted and workers returned to commute to their offices.
Travel agents and airlines sales were still down by about 27 per cent compared with October 2019, but that was a strong improvement from the nearly minus 50 per cent in the previous month.
Almost nine in 10 consumers said they were worried by the impact of rising inflation on their household finances, according to a monthly survey carried out by Barclaycard. A similar proportion reported to be concerned that rising bills would have a negative impact on their household finances.
However, Jose Carvalho, head of consumer products at Barclaycard, said that while the uncertainty around rising household bills appears to be weighing on British people’s minds, “the encouraging growth we’ve seen in entertainment and international travel shows that consumers are still keen to enjoy leisure activities and holidays”.
“As the nation continues its Christmas shopping and gears up for Black Friday and other sales, we’re confident that November should bring some welcome cheer to retailers,” he added.