Consumers in Spain, Italy and Poland are more concerned about the effect Brexit will have on their economy than British consumers are, according to a study by Mintel.
The globally intelligence company surveyed 7,000 consumers across the continent and found 48% of Spanish consumers fear that Brexit will have a “somewhat” or “extremely” negative impact on their own economy, as do 41% of Italian and Polish consumers. More than one in three (36%) Germans agree that the UK’s vote to leave will have a negative impact on their country’s economy and 31% of French consumers say they expect it to impact France’s economic growth.
This compares to 39% of British consumers who expect the UK’s vote to have a negative impact on their economy. A “sizeable minority” of British consumers believe Brexit could be good for the economy, says Mintel: 25% think that it will have an “extremely” or “somewhat” positive impact.
However that confidence is not shared by Europeans who believe the UK economy will be damaged by the decision to leave the EU. Some 64% of Germans say that the Brexit vote will have a negative effect on Britain’s economy, as do 58% of Spanish consumers, 50% of French, 43% of Italian, and 41% of Polish respondents.
Toby Clark, director of EMEA Research at Mintel, said the survey results showed how “widely the repercussions of the Brexit vote have spread and clearly highlight the risk that uncertainty and disruption have, as well as the potential to drag down consumer sentiment across the continent as a whole.” But the data also showed that British consumers “are much more upbeat about their prospects” than their European counterparts, he said.
Top of Europeans’ concerns about Brexit is the impact on unemployment with 42% of Italian, 40% of Spanish and 50% of Polish consumers saying it will have a negative effect on their respective national unemployment levels. In comparison 37% of British respondents believe it will have a negative impact on unemployment here, while 24% believe employment prospects will improve.
However British consumers are concerned about rising prices with almost half (46%) of UK consumers saying they expect the cost of living to be negatively impacted as a result of Brexit, followed by 41% of Italian, 36% of Polish, 34% of Spanish and 22% of German consumers.
It is clear from the survey that consumer confidence as a whole has taken a hit as a result of the leave vote (recent footfall figures from Springboard back this up) with just over one quarter (27%) of consumers said that they were pretty confident they would be ok, down from one in three (33%) Brits who agreed with this statement in May 2016, prior to the vote. Meanwhile, 55% said they were concerned about their finances over the next year, but should be fine, up from 52% who said this two months previously.
“British consumers are far more optimistic about their own financial situation than they are about the prospects for the economy as a whole. For most people, nothing has actually changed yet – they’re still in a job and prices in the shops haven’t changed dramatically. It’s this tendency to separate their personal situation from the broader economic picture that explains why Mintel’s consumer confidence data hasn’t fallen as much as might be expected. The uncertainty about the future has hit sentiment, but it hasn’t been enough to wipe out the gains we’ve seen over the last few years.” said Clark.
Consumers are putting big-ticket spending on hold with home improvements expected to take the biggest hit. Just 18% of British consumers say they plan to spend money on the home in the next three months, down from one quarter (23%) who said the same before the vote in May 2016. Other activities such as holidays and entertainment appear to be holding up.
“Post referendum, the nation’s spending intentions don’t appear to have shifted markedly, other than plans to spend on the home, which seem to have been hit the hardest. For most consumers, there’s no real trigger to change spending patterns at the moment,” concluded Clark.