Consumer spending declines 6% in March as coronavirus measures take effect
Consumer spending in the UK dropped 6% year-on-year in March 2020, as measures to tackle coronavirus were introduced by the Government.
Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, reveals that spending on non-essentials was down 12.9%, with many retailers impacted by the introduction of social distancing measures.
Spending on essential items rose by 11.6% with Supermarket purchases driving much of this growth.
Online purchases increased by 5.5% in March, while in-store transactions on the other hand dropped 4%.
In a tumultuous month, consumer confidence dropped to its lowest level since Barclaycard started surveying data six years ago, with just 25% of UK adults feeling positive about the state of the UK economy – down 17% from last month.
In response to British Retail Consortium pressure and widespread consumer demand, the contactless limit for in-store card transactions increase from £30 to £45 this month.
The increased limit was introduced in response to the coronavirus outbreak, as a measure to reduce the need for physical contact with PIN-Entry Devices at points of sales.
The figures come from 2,000 respondents, providing a representative sample of UK consumers by age, gender, region, and income.
Esme Harwood, Director at Barclaycard, said: “The coronavirus pandemic continues to impact everyday life in the UK, and this is naturally reflected in where and how Brits are spending their money.
“It’s no surprise that essential spend has increased as tighter movement restrictions have meant consumers are largely staying indoors, and therefore unable to visit the high-street, socialise in person, or travel."
The figures support previous stats from BDO’s High Street tracker, which reported Like-for-like store sales slipping 0.9% in early 2020.
The international retail sector has recently set up a new Association of International Retail, which unveiled a recovery plan for the industry to be put into action when the Coronavirus is contained.