Spending rises as Brits set for summer splurge
Consumer spending rose 7.6% in May compared with the same period in 2019 – the highest growth recorded since coronavirus restrictions began – as the further lifting of lockdown restrictions encouraged more Brits to shop and socialise.
New data released by Barclaycard on Tuesday showed that spending on essential items was bolstered by supermarket shopping (17.7%) and face-to-face spending at local food and drink specialist retailers (69.3%), such as butchers and independent convenience stores.
The Barclaycard report combined hundreds of millions of customer transactions with consumer research to provide an in-depth view of UK spending. Barclaycard sees nearly half of the nation’s credit and debit card transactions.
Brits also spent more on outfits and beauty products for post-lockdown socialising, with uplifts at clothing (8.5%) and pharmacy, health and beauty outlets (17.8%).
Other specialist retailers, such as gift shops, toy shops and jewellers, enjoyed growth of 27.2% – over four times higher than last month’s increase (6.4%) – perhaps a sign that consumers are buying more presents for reunions and celebrations such as weddings, birthdays and baby showers. This comes as nearly seven in 10 (68%) say they are comfortable spending time with friends and family outdoors, and six in 10 (61%) say they are comfortable doing so indoors.
Signs of recovery for the hospitality industry emerged as more restrictions lifted on 17 May: restaurants (-53.2%) as well as pubs and bars (-19.4%) saw smaller declines than in April, when the categories dropped 74.4% and 67.2% respectively.
As international travel restrictions continue, more holidaymakers also booked or set off on staycations, with spending on resorts and accommodation growing 25.5%.
This comes as one in five (20%) say they’ve already made plans to go on a staycation in the weeks following 21 June, and around the same proportion (18%) intend to go on more holidays in the UK, even after international travel restrictions have been lifted.
Consumer confidence in the economy and household finances remains noticeably higher than this time last year, holding up at 35% and 72% respectively, compared to 20% and 67% in May 2020.
Read more: UK average house price hits record high in May
“May was a positive month for a range of categories, with the nation clearly determined to show support for retailers and local businesses," said Raheel Ahmed, head of consumer products. "As friends and families reunited after months apart, it is reassuring to see signs of recovery for the entertainment and hospitality industries, both of which have faced significant challenges over the past year.
“While international holidays continue to be hampered by restrictions, staycations in the UK are providing a welcome boost to the travel sector, as May saw more holidaymakers, particularly in the older age groups, book or embark on trips. With summer – and hopefully more of this warmer weather – on the way, we hope to see these positive trends continue as Brits make the most of their newfound freedoms.”
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