UK Consumer Spending Report

May 2021

Barclays UK Consumer Spend Report gives you a unique and up to date picture of the nation’s spending habits based on the actual transactions, bringing it to life so you can take action and shape your strategy. 

Our latest report looks at UK Consumer spending patterns to the period 24 April 2021 to 21 May 2021

Highlights this month:

• As restrictions eased across the UK in May, consumer spending continued to grow, increasing by 7.6% compared to the same period in 2019.

• Essential spending rose 11.4%, the highest year-on-two-year spend increase since before the onset of the pandemic.

• Non-essential spending returned to growth for the first time since October 2020, increasing by 5.8% compared to the same period in 2019 as consumers supported re-opened non-essential retail and hospitality venues.

• Despite the majority of indoor hospitality only re-opening on the 17th May, the sector has seen significant improvements in spend, with spend at restaurants down 53.2% compared to -74.4% last month and Bars and pubs down 19.4% vs -67.2% respectively in April.
  

Big picture spend update

Overall consumer spending in May increased by 7.6%, as consumers continued to return to non-essential retail venues as indoor hospitality has re-opened across much of the UK. Spending on essential items rose 11.4%, the highest year-on-two-year growth reported since before the onset of the pandemic. This was partially driven by 17.7% growth in supermarket spending, but also helped by a continued increase in fuel spend at -3.7% compared to -8.1% reported last month, as consumers were more comfortable travelling further afield to visit friends and family. This comes as nearly seven in ten (68%) say they are comfortable spending time with friends and family outdoors, and six in ten (61%) say they are comfortable doing so indoors¹.

Spending on non-essential items returned to growth for the first time since October 2020, up 5.8% compared to the same period in 2019, the highest level of growth since pre-Covid. This was driven by strong performance in Clothing (+8.5%) and Department Stores (+8.6%) as consumers hit the high street. Sports & Outdoor retailers also saw significant growth, up 47%, as Brits geared up for a summer of sport and outdoor activities. While restaurants as well as bars and pubs saw respective declines of 53.2% and 19.4% for the month overall, these were marked improvements on the -74.4% and -67.2% reported in April. In fact, spending on bars and pubs saw a 1.4% growth among 16-24-year-olds, as younger returned to socialising at the earliest possible opportunity.

¹Barclaycard Consumer Confidence Survey May 2021

Category snapshot: what are UK consumers spending on?

Retail spend increased 27.8% year-on-two-year in May. Consumers prepared their homes and gardens for a summer of hosting friends and family as Furniture Store spend surged 55.7%. There were signs that Brits were becoming more conscious of their appearance with summer around the corner as spend at Pharmacy, Health & Beauty stores also rose 17.8%. Spend on Jewellery & Watches also surged 51%, perhaps a sign that consumers are buying more presents for reunions and celebrations such as weddings, birthdays and baby showers. Clothing retailers returned to growth for the first time since September 2020 at 8.5% vs -6.6% in April, with spend from those aged 50-64 driving the increase.

Hospitality venues were able to re-open for indoor business on May 17th and this resulted in some continued improvement in consumer spending at restaurants (-53.2%), and Bars and Pubs (-19.4%) compared to -74.4% and -67.2% respectively last month. Consumer spending on resorts and accommodation, which is reflective of the UK staycation market also continued to rise, as spend increased by 25.5% compared to the same period in 2019. Consumers over 50 led the growth in staycation spend with spend up 36.2% for this age group, a likely consequence of vaccine rollout, as staycation spend amongst those aged 16-24 declined 13.1%. Easing restrictions meant more people continued to use public transport, with spend down 37.6% compared to -50.3% in April.

Channel snapshot: how are UK consumers spending?

As restrictions continued to ease across the UK, in-store spend improved significantly, declining just 0.9% in May, compared to -14.7% in April. Overall online spend increased 19.8% to take 45.8% of total spend. Face-to-face non-essential retail spend bounced back to growth for the first time since pre-Covid, increasing 8.0% vs the same period in 2019, a huge improvement on the -17.4% reported in April as consumers returned to the high street in numbers. Online non-essential retail continued to do well, increasing 58.3%, however this was lower than the 73.9% reported in April showing signs that consumers are transitioning back to the high street.

Online non-essential retail continued to do well, increasing 58.3%, however this was lower than the 73.9% reported in April showing signs that consumers are transitioning back to the high street. As consumers appeared to be more comfortable shopping on the high street, there was a notable change in purchasing behaviours –47% of all clothing spend was made face-to-face in May compared to just 31.8% in April. Specialist Retailers also saw a 10% increase in face-to-face spend, driven by a 35.2% increase in face-to-face spend on Jewellery & Watches vs the same period in 2019, a huge improvement on -34.5% seen in April.