Consumer spending was up 2.9 percent year-on-year in January after a slow December, but that didn’t help the clothing industry which, along with department stores, saw expenditure decline for the fourth consecutive month.
Data from Barclaycard showed that essential spending climbed to 6.4 percent, the highest level for five months, fuelled by supermarket spend which was up 6.8 percent, their highest growth since April 2017.
Non-essential expenditure was down, however, seeing an increase of just 1.7 percent, with clothing and department stores experiencing their fourth consecutive month of decline, contracting by 0.9 percent and 0.6 percent, respectively.
One of the reasons behind this drop could be consumers waning interest for January sales, according to Barclaycard, who say that over half of UK adults (52 percent) say January sales are less important than they were two or three years ago, while one in four (24 percent) say they are losing interest in the discount period because retailers are offering sales throughout the year.
Consumers caution about their expenditure also remains high, according to Barclaycard, with seven in ten (70 percent) of respondents saying they are becoming more careful in finding value for money in their purchases, while over half (54 percent) say they are concerned that rising prices of everyday items could affect their spending power in the future.
“Despite a modest uplift in overall consumer spending, retailers continued to struggle as the traditional January sales period wasn’t enough to entice shoppers to spend,” Esme Harwood, director at Barclaycard, said in a statement. “Looking forward, consumers will continue to prioritise value for money, especially as many have concerns about potential price increases on everyday essentials.”
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