As Christmas approaches, consumer confidence remains low, driven by concerns about the economy.
- Recent survey reveals a slight improvement in personal financial expectations despite economic anxieties.
- Retail spending plans show minimal increase, but overall stability in consumer saving and spending.
- Economic outlook perceptions have deteriorated, influencing pre-Christmas consumer sentiment.
- Retailers face pressure from increased costs, potentially impacting pricing and employment in 2025.
A survey conducted by the British Retail Consortium (BRC) in collaboration with Opinium has highlighted ongoing concerns among consumers regarding the state of the economy as Christmas nears. The survey, conducted between 12 and 15 November, points to a persistent unease about the economic landscape among UK consumers.
Despite this overarching concern, there has been a slight shift in expectations surrounding personal finances. The survey indicates a marginal improvement from October to November, with expectations for personal financial situations rising from -4 to -3. This shows a minor but noteworthy boost in consumer sentiment about individual financial health, albeit overshadowed by broader economic apprehensions.
Retail spending plans have experienced a small increase, moving from 2 in October to 3 in November. However, personal spending and saving metrics showed no significant movement, maintaining a steady state at 17 for spending and -9 for saving, respectively. This stability suggests an overall cautious approach by consumers as they navigate economic uncertainty.
Conversely, expectations for the broader economy have taken a downturn, deteriorating from -17 in October to -19 in November. This decline reflects a growing pessimism about the national economic situation, likely exacerbated by ongoing economic challenges and uncertainties.
BRC CEO Helen Dickinson noted the limited impact of the recent Budget on changing consumer attitudes. With over £7 billion in additional costs anticipated for 2025 following the Budget, Dickinson highlighted the pressures on retailers who are likely to face tough decisions regarding pricing and investment. “The government must ensure that the forthcoming changes to the business rates system in 2026 result in meaningful reductions in bills for all retailers,” Dickinson urged.
Nearly 80 retail leaders recently endorsed a letter from the BRC to the Chancellor. This letter warned of the potential for inevitable job losses and increased prices as a direct consequence of the Budget’s financial implications. This highlights the critical need for deliberation and action to mitigate adverse impacts on the retail sector.
Consumer confidence remains fragile amidst economic uncertainties, compelling the retail sector and government to address these critical challenges.
