Credit, collections & insolvency news
Consumer spending grew by 1.2 percent year-on-year in February, equating to a decline in real terms when adjusting for inflation according to new data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, shows that essential expenditure rose by 2.3 percent, propped up by relatively modest growth in supermarkets of 2.5 percent as petrol spending contracted by 1.2 percent.
Non-essential spending, meanwhile, saw growth of just 0.8 percent. Spending on clothing contracted by 5.2 percent, while department stores saw another month of decline of 5.5 percent.
After consecutive months of growth, hotel spending saw a contraction of 3.8 percent. Pubs and restaurants, traditionally both strong categories, were also not immune –reporting unusually low growth of 7.4 and 3.9 percent respectively.
This drop in spending may be due to consumers re-evaluating their budgets. Almost one in three Britons (32 percent) say they are cutting back on non-essential items (such as eating out or buying new clothes), or shopping more often at discount stores in order to make their money go further.
Ongoing economic uncertainty means many consumers continue to take a cautious approach to spending. Half of UK adults (50 percent) worry that Brexit will have a negative impact on the UK economy and cause their personal finances to suffer. 53 percent are also concerned that a rise in the cost of everyday items over the next month will impact their spending.
Furthermore, almost one in five Brits (18 percent) have started stockpiling essential food items in case of shortages in the near future.
Esme Harwood, Director at Barclaycard, said “Uncertainty over Brexit appears to be driving a shift in behaviour, with many Brits worrying about price rises and cutting back on non-essential spend, and some even stockpiling everyday items.”
“Discretionary expenditure has seen a considerable decline – spending at retailers continues to decrease, and even hotels, pubs and restaurants are feeling the impact of cut backs.”
| Y/Y Spend growth by category | |
| Overall | |
| Clothing | -5.2% |
| Family Clothing | -6.8% |
| Shoe Shops | -4.1% |
| Women’s Clothing | 4.8% |
| Men’s Clothing | -2.5% |
| Restaurants | 3.9% |
| Auto Parts & Accessories | -1.2% |
| Cinema, Theatre & Dance | -16.0% |
| Public Houses | 7.4% |
| Department Stores | -5.5% |
| DIY Stores | 1.5% |
| Travel Agents | -3.0% |
| Airlines | -1.0% |
| Supermarkets | 2.5% |
| Petrol | -1.2% |
| Gambling | -6.9% |
| Vehicle Sales | -5.7% |
| Hotels | -3.8% |
| Auto Repair Shops | -3.9% |
| Sports Shops | -3.3% |
| Furniture Stores | 2.8% |
| Telecoms | 1.7% |
| Household Appliances | -6.3% |
| Jewellers | -0.3% |
| Sports and Games Establishment | 0.5% |
| Garden Centres | 0.2% |
| Discount Stores | -11.4% |
| Gift Shops | -4.0% |
| Floor Covering Stores | -1.4% |
| Tourist Attractions | -23.0% |
| Amusment Parks | -14.2% |
| Aquariums | -10.0% |
| Electronic Stores | -2.4% |
| Cosmetic Stores | 3.5% |
| Optical Goods | 4.4% |
| Overall | 1.2% |
| Average Transaction Value | |
| Overall | -5.7% |
| Clothing | -1.3% |
| Airlines | -3.2% |
| Restaurants | -5.1% |
| Supermarkets | -3.4% |
| Petrol | -2.2% |
| Number of Transactions | |
| Overall | 7.3% |
| Clothing | -3.9% |
| Airlines | 2.2% |
| Restaurants | 9.5% |
| Supermarkets | 6.1% |
| Petrol | 1.0% |
