Spending on home improvements and garden furniture in February, in preparation for the restart of outdoor socialising in England next week, helped the retail sector stage a modest comeback during the UK’s third lockdown.
Retail sales increased by 2.1% in February from the previous month but the high street continued to struggle, with all non-essential shops forced to remain closed.British high street lost 11,000 shops in 2020, study shows Read more
The Office for National Statistics said the partial recovery, from a 8.2% slump in January, kept sales in the retail sector 3.7% lower than a year earlier and they would have fallen further without a bounce in sales at hardware and DIY shops, and discount retailers selling garden furniture and homewares.
With many shop owners, and especially those that rely on high street sales, under severe financial pressure, the figures showed that online retailers have benefited. Almost 38% of retail sales were made online, up 4.6% from January and almost double the level of a year ago.
On 29 March, the rule of six returns after 12 weeks, allowing people across England to gather up to a maximum of six. Limited contact between different households will be allowed and many outdoor activities, such as golf and tennis, can resume.
Families with access to a garden are expected to exploit the hoped-for warmer weather over Easter to meet for the first time since November.
Sales of household goods were up more than 16% from January, while discount stores – such as B&M and Home Bargains – most of which have stayed open selling a mix of food and homewares, were up by the same amount.
Jonathan Athow, the deputy national statistician for economic statistics at the ONS, said: “Despite national restrictions, retail sales partially recovered from the hit they took in January.
“Food and department stores benefited from essential retail remaining open, with budget-end department stores seeing increased sales.
“Household goods also fared well, with feedback suggesting spending on home improvement and outdoor products boosted sales as consumers prepared for an easing of lockdown restrictions.
“However, clothing stores continue to struggle, with sales down more than half on their pre-pandemic level.”
Analysts said this drop tallied with inflation data released earlier in the week, which showed that fashion outlets had slashed prices further in February after a steep fall in sales during January.
James Smith, an economist at ING, said: “With the country still in lockdown, none of this is too surprising, and it’s worth saying that overall sales are down only around 4% on pre-virus levels, a marked improvement on what we saw last spring.
“Experience of lockdowns also tells us that it will probably only take a matter of weeks for sales to return – or exceed – pre-virus levels once the shops reopen.”Guardian business email sign-up
Lynda Petherick, the head of retail at the consultancy Accenture UKI, said February’s figures showed there were early signs of brighter days ahead for retailers.
“However, we are still a long way off from recovering to numbers compared with this time last year. With the April reopening date for non-essential retail still on the cards, retailers will be planning how they can make the most of pent-up consumer demand this spring and beyond.”
The impact of the UK’s third lockdown on the economy has not been as severe as the 22% drop in the first lockdown last April after the bulk of British employers adapted to working online.
The ONS chief economist, Grant Fitzner, said a shift to online shopping before the pandemic to a level not seen in any other major OECD country meant the UK economy had proved more resilient during the government lockdowns.
The government is expected to allow all non-essential shops in England to open on 12 April, as part of its policy of opening up the economy gradually between now and June. The governments in Scotland, Wales and Northern Ireland plan to reopen on a different timetable, although following a similar path.