Spending drops 1.9% in April, the wettest on record, as shoppers postpone spending on summer goods
A record amount of rainfall in April put shoppers off revamping their summer wardrobes and stocking up on garden furniture. Consumer spending suffered one of the largest monthly falls since the height of the financial crisis in early 2009, which even a 5,000% increase in umbrella sales at John Lewis in the last week of April could not prevent.
The wettest April since records began in 1910 kept shoppers away from the high street, and this year there was no royal wedding to encourage spending. John Lewis bucked the trend and enjoyed strong sales, with men’s jackets and other outerwear significantly up. But according to Visa Europe’s UK expenditure index, household spending slumped 1.9% month on month in April, following a 0.3% rise in March. Compared with the same month last year, spending was down 4.3%, much worse than the 1.9% fall seen in March, and the steepest decline in 11 months.
Steve Perry, commercial director at Visa Europe, said spending in March was artificially inflated by fuel panic-buying, which masked weak consumer confidence. He said the data reflected the fact that Britain’s economy is back in recession.
On the high street, spending crashed by 6.9% in April compared with 2011, while online spending held up quite well, sinking just 0.8%, indicating that shoppers were simply in no mood to brave the dismal weather. However, mail and telephone orders fell by a hefty 6.6%. Sales of household goods suffered a decline of nearly 10%, while food, clothes and shoe sales plunged by more than 8%, according to the Visa figures.
The weather dictated sales for the week at John Lewis, which also owns Waitrose: sales of tights jumped 80%, hot drinks by 62% and umbrellas by 5,000% compared with last year. Sales of bird food climbed by 71% as shoppers spared a thought for their feathered friends during the cold and wet spell. For themselves, customers stocked up on comfort food like ready-made yorkshire puddings, up 75%, and frozen chips and potatoes, up 21%.
Chris Williamson, chief economist at Markit, which compiled the figures for Visa, said: “Some payback from higher spending on petrol was to be expected following the panic buying in March, as was a drop in expenditure on new season clothing and items such as garden furniture due to the warm weather seen in March, which caused many people to pull forward these purchases.”
He added: “Consumer spending remains under pressure from a considerable list of headwinds, including high unemployment, widespread job insecurity, low pay growth, high inflation and high debt. As such, it would be surprising to see any pickup soon.”