Re-opening of hospitality and the success of the vaccination programme is driving confidence as consumers hit the high streets.
The latest figures from the Confederation of British Industry monthly survey published 25 June, has shown retail sales and orders growing at the fastest pace since August 2018 and September 2015 respectively. The survey also found that stock levels in relation to expected sales reached a record low in June – a question first asked in August 1983. Meanwhile, growth in internet sales slowed sharply in the year to June, to the weakest pace since April 2020 and well below the long-run average.
Ben Jones, Principal Economist at the CBI, said: “After a generally gloomy 2021 so far, the sun finally shone for retailers in June, with seasonal sales volumes the strongest since November 2016. This was the latest sign that the success of the vaccination programme is feeding through to stronger consumer confidence which, along with the re-opening of hospitality, is encouraging shoppers back onto the streets.
“But the sector remains a long way from a full recovery. The return of demand is patchy, with inner-city footfall still well down. The outlook is also clouded somewhat by supply pressures, with stocks seen as too low compared with expected sales, as logistical and capacity challenges continue to hamper global activity.
“Even as consumer demand returns, the legacy of lockdowns on retailers’ balance sheets remains. Many will welcome the rent moratorium extension, but more support is needed, starting with holding off on tapering existing business rate reliefs.”