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Retail sales rebound despite recession

Retail sales rebound despite recession
Emma Lunn
Written By:
Emma Lunn

Retail sales volumes rebounded by 3.4% in January 2024, following a record fall of 3.3% in December 2023, according to the Office for National Statistics (ONS).

This was the largest monthly rise since April 2021 and returned volumes to November 2023 levels.

Sales volumes in all subsectors except clothing stores increased over the month, with food stores such as supermarkets contributing most to the increase.

Looking over a longer period, sales volumes rose 0.7% between January 2024 and January 2023, but were still 1.3% below their pre-coronavirus pandemic level in February 2020.

Food store sales volumes rose by 3.4% over the month (0.6% over the year), recovering from December’s record fall of 3.1%. Within food stores, the fall in December 2023 and recovery in January 2024 was mainly because of supermarkets.

Non-food store sales volumes (the total of department, clothing, household and other non-food stores) returned to broadly expected levels, with a rise of 3% over the month following a 3.9% fall in December.

Sales volumes in department stores and other non-food stores (such as sports equipment stores) rose over the month by 5.4% and 6.2% respectively, with some retailers reporting the positive impact of January sales. Household goods stores rose by 1.8% in January 2024, which was mainly because of sales in hardware stores, while clothing stores fell by 1.4%.

‘Shoppers remained cautious’

Kris Hamer, director of insight at the British Retail Consortium, said: “There was promising news as sales volumes rose for the second time in three months, following 19 prior months of decline. This reflected rising levels of consumer confidence, as well as a boost from the January sales. Categories such as computing, and cosmetic and toiletries performed well. Food sales continued to outstrip non-food sales – mainly due to higher levels of inflation on these products. Nonetheless, shoppers remained cautious as they entered the third year of the high cost of living.

“Retail plays a vital role in unlocking household spending and boosting economic growth across the UK. As the everywhere economy, retail serves all of us, providing the things we need as well as local jobs and investment.

“It is vital that our future Government recognises the importance of retail considering the cumulative cost burden created by new and existing policies. Business rates’ rises, inadequate recycling proposals, new border control costs – only by addressing these issues can the next Government unlock further investment for the country and boost local and national economic growth.”