Barclaycard: April consumer spending down 36.5%
Consumer spending contracted by 36.5% year-on-year in April, showing the impact of ongoing social distancing measures.
Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, reveals that spending on essential items declined by 7.5%, which can largely be attributed to a 58.9% reduction in fuel spend. Supermarkets, meanwhile, continued to see a boost in sales – climbing 14.3% as Brits made larger shops and prepared more meals at home.
Spending on non-essentials fell by 47.7% with travel, which includes public transport, seeing a decline of 86.8% as much of the UK stopped commuting. Bars, pubs & clubs also contracted by 96.9%.
Food and drink specialist stores – which includes off-licences, greengrocers, independent convenience stores, butchers and bakeries – were a bright spot, seeing 37.7% growth. This was helped by Brits continuing to support local businesses, with more than half (57%) saying the current environment has made them realise how much they value these stores. As a result, UK adults are planning to spend more in local retailers including butchers (27%), cafés and restaurants (26% and farmer’s markets (23%) when restrictions are lifted.
While overall home improvement and DIY declined by 42.7%, it seems Brits are still taking advantage of this time to smarten up their homes and gardens, as online spend in this category increased by 26.5% – accounting for 86.1% of purchases. Digital subscriptions continued to increase in popularity with strong growth of 50.2%. Online spend for eating and drinking – which includes takeaways – also saw growth of 24.6% as diners treated themselves, while also helping to support local restaurants.
With many shops closed and much of the nation not commuting, almost nine in 10 UK adults (88%) have saved money on everyday expenses since the lockdown began. Nearly a third (31%) of those are putting the money into savings; 23% towards their next holiday; and nearly one in 10 (9%) are planning to buy their family a treat.
These savings may partly explain why the UK’s confidence in its household finances remains resilient at 70% – a figure that rises to 85% of those aged 55, compared to 58% of adults in their late teens to early thirties.
Despite this personal positivity, consumer confidence in the UK economy overall has dropped to its lowest for at least six years: just 20% of adults feel positive, representing a 5% decrease from last month.
Confidence in job security also declined to 42%, its lowest level for 17 months, suggesting concern for the months to come.
Esme Harwood, director at Barclaycard, said: “It’s been a tough time for retailers as consumer spending has dropped considerably under lockdown. There are some bright spots, though, as Brits have turned their focus online and looked to takeaways, digital subscriptions and DIY to keep entertained and occupied. A renewed sense of community may be welcome news for independent businesses, with a growing desire to support local stores in life after lockdown.”