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Barclaycard: Consumer Spending Rose 11.1% In June

Shoppers social distance mask covid19  I. Salci  Shutterstockdotcom1756835096
  • Spending on fuel, hotels, resorts and accommodation all grew for the first time since the pandemic began, as holidaymakers booked and embarked on UK breaks
  • As the nation enjoyed key sporting events, spending at pubs and bars rose 38.1 per cent – the biggest increase since September 2020
  • Shopping at supermarkets and food and drink specialist stores performed strongly, as Brits kicked off the summer with BBQs and picnics
  • The Barclaycard report combines hundreds of millions of customer transactions with consumer research to provide an in-depth view of UK spending 

Consumer card spending grew 11.1 per cent in June compared to the same period in 2019, as the warmer weather, easing of restrictions and major sporting events saw more Brits socialise and set off on staycations. 

Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, reveals that spending on essential items grew 14.7 per cent – the sharpest rise since before the start of the pandemic in March 2020. This was driven by strong uplifts in supermarket shopping (19.0 per cent) and spending at specialist food and drink stores (76.4 per cent) – including butchers, bakeries, and off-licenses – as the nation kicked off the summer with BBQs and picnics. 

Fuel spend also rose 3.6 per cent – the first growth since the pandemic began – as more Brits took to the roads to visit loved ones and take holidays in the UK. 

Non-essential items performed strongly overall, rising 9.4 per cent – the largest growth in non-essential spend since the onset of Covid-19. This was boosted by the eating and drinking category, which grew 36.7 per cent compared to the same period in 2019, while also representing a strong month-on-month uplift (+2.5 per cent in May 2021). 

Spending at bars and pubs rose 38.1 per cent – the first growth since September 2020 – as the nation flocked to pubs and beer gardens to enjoy the heatwave in early June and watch key sporting events on the big screens. This trend looks likely to continue, as over two fifths (41 per cent) of Brits say fixtures taking place over the next few weeks, including the Tokyo Olympics, will increase their spending as they socialise with friends and family and enjoy a summer of sporting entertainment. 

As more gatherings took place in June, ordering takeaways and fast food remained in high demand, recording a 146.0 per cent surge in online spend, including food delivery apps and services.

Restaurants also showed early signs of recovery, experiencing a relatively low fall in growth (-8.4 per cent) when compared to the 74.4 per cent and 53.2 per cent declines recorded in April and May. This trend looks set to continue over the summer as restrictions ease, with consumer confidence data finding that 22 per cent of Brits upped their spending on meals and drinks out on sunnier days.

There were also glimmers of hope for the UK travel industry; the hotels, resorts and accommodation category saw its first growth (5.4 per cent) since pre-pandemic times, as Brits continued to holiday in the UK. However, many remain cautious about overseas travel, with the traffic light system restrictions continuing to impact travel agents and airlines, which saw respective decreases of 75.3 per cent and 70.9 per cent. 

Face-to-face retail also saw positive growth in June (9.7 per cent), with uplifts across a range of categories including home improvements & DIY stores and sports & outdoor retailers with increases of 21.6 per cent and 14.2 per cent respectively. However, there were signs that pent-up demand following lockdown is easing off, as clothing and furniture stores recorded smaller increases, rising by 2.8 per cent and 26.3 per cent, compared to 8.5 per cent and 55.7 per cent in May 2021. 

Entertainment, which includes cinemas, bowling alleys and golf courses, also showed signs of recovery as Brits enjoyed outdoor activities and more leisure venues opened, with just a 1.7 per cent decline – a noticeable improvement on the 28.6 per cent drop last month. The data shows that consumers aged 65 and over have been driving this improvement, with their spending increasing 4.7 per cent compared to 2019 – perhaps a reflection of rising levels confidence among this age group. 

Confidence in household finances and the UK economy has also held up at 70 per cent and 36 per cent respectively, as over half (55 per cent) of those feeling optimistic about the economy cite the vaccine roll-out as the main reason for their positive outlook.

Almost two thirds (64 per cent) of Brits feel the prices of everyday items are higher than they used to be, which could be attributed to the recent rise in inflation, or perhaps a shift in the perception of the cost of living as we transition back to normality following months of lockdown and restricted spending. 

Raheel Ahmed, Head of Consumer Products, said: “June saw Brits flock back to pubs, bars and beer gardens to watch the football and tennis on the big screens, as the heatwave early in the month encouraged many of us to get out in the sunshine and socialise. 

“The start of the Olympics and the expected easing of restrictions later this month should continue to lift spirits and provide more opportunities for get-togethers, whether that’s a weekend break, a meal out or to celebrate sporting victories. It’s great to see Brits making up for lost time over the past year.”

Source : Barclaycard

Image : I. Salci / (1756835096)

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13 July 2021

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