UK retail sales jump nearly 14% to near pre-lockdown levels as restrictions ease

Economists warn some types of shops left behind despite boom in spending

Shoppers on the High Street in central London (EPA)

Pent-up consumers pushed UK retail sales near pre-lockdown levels in June, as spending rapidly rebounded after the coronavirus lockdown was eased.

New data from the Office for National Statistics (ONS) found sales volumes rose by 13.9 per cent last month compared with the month before, bringing total sales across the country close to last year’s levels.

It comes after the UK economy posted a 1.8 per cent increase in gross domestic product (GDP) in May, after shrinking by more than a quarter in March and April.

But the rise in sales was not represented evenly across the sector and some types of shops have been left behind. Textile, clothing and shoe stores showed the sharpest decline in total sales, at negative 34.9 per cent.

“The retail sector bounced back as the reopening of shops released pent-up demand for some retailers,” Richard Lim, chief executive of Retail Economics.

“But the recovery is being felt unevenly across the sector, with clothing retailers remaining under significant pressure.

“Some consumers searching to break the monotony of being at home headed for the high street, but numbers remained considerably lower than pre-Covid levels,” he added.

Online retailers have fared better than high street shops during lockdown, with online sales continuing to go “from strength to strength”, said the ONS. Although the proportion of online spending dropped to 31.8 per cent in June compared to a record 33.3 per cent reported in May, it remains a “considerable increase” from the 20 per cent reported in February.

Household goods stores were the only store type to see an increase in sales since the start of the pandemic, reported ONS, with online sales increasing by 103.2 per cent. Household goods stores also saw the smallest decline in store sales compare to other types of non-food stores.

“We see increased sales in electrical household appliances and hardware stores, with feedback from retailers suffusing that people focused on home improvements during lockdown, which helped boost their sales,” said the ONS report.

Jonathan Athow, deputy national statistician at ONS, told BBC: “Food shops continue to do quite well, as we’re eating at home more. But the real growth has been in online sales. Online sales continue to go from strength to strength.”

Urging caution against being overly optimistic about the potential for recovery, Ruth Gregory, senior UK economist at Capital Economics, said: “Since the sector has benefited disproportionately from online spending and a switch away from other types of spending, [the sales figure] overstates the extent of the recovery in the wider economy.”

Helen Dickinson, chief of the British Retail Consortium, said: “Though a month of growth is welcome news, retail is not out of the woods yet. The pandemic continues to pose huge challenges to the industry, with ongoing store closures and job losses across the UK.

“The reopening of shops is an important step on the road to recovery, but with months of rent building up, many shops will be forced to close unless action is taken before the next Quarter Rent Day.

“The government must remain open to further action to boost consumer demand and should take steps to support with rent costs or the industry could suffer thousands of avoidable job losses,” she added.

Additional reporting by agencies