Consumer spending in the UK continued its upward momentum in June 2013, according to the latest analysis of monthly spending trends from Barclaycard.
Consumer spend in June rose overall by 4.9% compared to June 2012 – the third month in the last five where year-on-year growth was above 4% and the highest spending growth recorded in the past 18 months. The findings are in line with previous Barclaycard data and other economic analysis and suggest that the economic recovery is continuing to gather pace.
The travel and entertainment sector continued to be the driving force of consumer spend. Cinema and theatre sales were up 16% compared to this time last year, most significantly in the latter half of the month, helped by the release of the new Superman film “Man of Steel”. Restaurant spend was also up 11.8% and airline spend grew by 13.3%, as more Brits treated themselves to a night out and booked holidays abroad.
The better weather conditions and more pressure on the high street to reduce prices also encouraged consumers to part with their money, resulting in parts of the retailing sector seeing a rebound. Spend on clothing, for example, which has been in the doldrums for much of the first half of the year, saw a4.2% rise as consumers finally began to update their wardrobes for summer. And the hope of sunny evenings and warm weekends sent Brits to garden centres and DIY stores to prepare for entertaining – spending was up 19% and 8% respectively.
Department stores suffered a near-6% fall in sales compared to last year, however, and electronics stores went back to negative territory (spend down by 1.6%) after seeing a short uplift in May (3.2%).
Overall, however, the robust performance of consumer spend provides further evidence that the UK economic outlook continues to brighten.
Val Soranno Keating, chief executive of Barclaycard, said: “A combination of better weather and lower prices encouraged more of us to open up our wallets in June, which proved to be another buoyant month for consumer spending in the UK, up almost 5% on the same month last year.
“It’s the highest spend growth that we’ve seen in 18 months, the third month in a row where it’s out-stripped inflation, and means that consumer spend was up (3.3%) for the first half of the year against 2012, providing further evidence that the UK economy is turning a corner.
“More good news is that growth in spending was seen both online and in-store, with online spend growing 12.5% year-on-year and high street spending up just over 3%, the highest rate seen so far in 2013.”
|Garden Centres||19.2%||Department Store||-5.9%|
Online vs. offline spend
Online spend continued its momentum and delivered 12.8% year-on-year growth. However high-street footfall was also on an upward trajectory in June. Spend at brick-and-mortar stores was up 3.3%, a one percentage point increase month over month and the highest rate seen so far in 2013.
Online spend share remained high at 19.7%, up 1.4 percentage points versus the same time last year, indicating the spend shift to the Internet continues.
Almost all categories of online spend are up vs. the same time in 2012. Despite suffering a weak performance overall, online spend at electronic stores spiked in June, up 32% on a year-over-year basis. Women’s clothing continued to evidence significant increase year-over-year online, spend was up 28% compared to 2012. Online cinema and theatre (27%) and furniture (26%) spend also saw significant increase compared to last year.
London and the West Midlands both saw 5.8% year-on-year spend growth –the strongest of the 12 regions we monitor, followed by East Midlands (5.6%). Northern Ireland spend growth of 4.1% was at the bottom of the list.