Consumer woes weigh on retail

 
Tim Wallace
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UK RETAIL sales are poor for the time of year and expected to get worse, according to an influential business survey published yesterday.

An equal number of firms reported sales falling as rising in the first two weeks of March, leaving a net balance of zero growth, the Confederation of British Industry’s distributive trades survey showed.

Sales fell sharply in January, with 22 per cent reporting a decline, before stabilising in February and March.

A net balance of four per cent of firms expect sales to fall in April, compared with a net two per cent forecasting growth a month ago.

“The consumer is not providing any support to economic growth at the moment, and may have even acted as a drag on the economy in the first quarter,” said economist Chris Williamson from Markit.

“While both the consumer finance and the retail sales data suggest that consumer spending is not showing the declines seen last year, the data suggest that shoppers remain very reluctant to spend in general, worrying about job security, rising unemployment, high petrol prices and low wage growth.”

Retailers selling recreational goods were worst hit, with 100 per cent reporting falling sales, followed by a balance of 56 per cent of chemists and 18 per cent of footwear retailers.

But furniture and carpet stores saw good growth, with a balance of 58 per cent reporting rising sales, followed by grocers with a balance of 33 per cent.