Consumer Spending Grows in August

Consumer spending in the UK grew in all sectors other than international travel during August, when compared to consumer spending back in August 2019, according to Barclaycard.

Spending on essential items grew 14.5% while spending at supermarkets and other food and drink stores also increased by 15.2 % and 76.9% respectively. The purchase of non-essential items also increased by 15.9% - the highest increase since the first lockdown. The consumer spending surpassed July’s figure of 10.4% as UK consumers spend more on UK-based holidays and socialising.

Restaurant spending broke into positive growth for the first time since the start of the pandemic, going up by 0.1%, while spending in pubs, bars and clubs reached 43.4% - the highest growth recorded for over 17 months. The warm weather and continued relaxing of Covid rules had positive impact on entertainment – theatre, festival and theme park tickets – which reached a new high of 24.2%. Taxi and fuel spending also increased, going up by 20.6% and 7.2% respectively.

With kids going back to schools, clothing sales rose for the fourth consecutive month, reaching 33.5% online growth, and 12.8% overall. There was also a 4.4% growth in department store sales.

Overall, confidence in the UK economy rose to its highest point - 37% since February 2020 - 42% - with 78% of Brits confident in their ability to live within their means each month, and 71% feeling optimistic about their household finances.

There is concern about rising prices with 64% of consumers worried about prices increasing, with 42% making changes to their lifestyle to compensate.

Commenting on the news, Barclaycard’s head of consumer products Raheel Ahmed said: “Socialising, shopping, and staycations were top of the agenda for Brits in August, as families and friends made the most of the school holidays, giving a welcome boost to hospitality and leisure businesses.

 

“Over the coming months, these sectors should also benefit from Brits returning to the office, as colleagues enjoy long overdue catch-ups over post-work meals and drinks.”