Pubs saw 8% sales rise in August

Wednesday, September 7, 2022

Consumer spending rose at an annualised rate of 4.7 per cent in August, the smallest annual increase since March 2021 as the cost of living slowed retail business.

Restaurants, bars, pubs and clubs enjoyed gains in August from 6.6% to 8.4%, while the domestic travel sector was buoyant, with summer vacations to hotels, resorts and accommodation up by 4.1% month-on-month.

While the summer holiday boosted spending on hospitality and domestic travel, total monthly spending dropped by -1.9 per cent as consumers become more selective about discretionary purchases, to ensure they can afford to run up household bills.

Spending on nonessential goods grew by 3.6 percent year-over-year, the smallest year-over-year growth seen since February 2021.

Optimism about the UK economy has also plummeted to 21 per cent, from 26 per cent last month and 37 per cent in August 2021, with levels lower since August 2020.

Makala Green, consultant finance and author, said: "The current cost-of-living crisis is arguably the biggest squeeze on living standards in decades. While it's encouraging that many Brits have enjoyed the last of summer by going on staycations and supporting pubs and restaurants, the winter months ahead will place new pressures on personal finances and budgeting.

The rise in energy prices in October has also damaged consumer tempers: 32% plan to reduce discretionary spending to meet energy costs in autumn and winter, and 21% say that they can little longer afford a luxury as a 'pick-me-up'.

A large number felt the worst was yet to come, with 82% believing living costs to keep on rising, while 20% cited rising costs as having a negative impact on their mental health.