Consumer card spending grew 11.6 per cent in July compared to the same period in 2019, as the heatwave and easing of restrictions saw Brits make the most of their newfound freedoms.
Pubs, bars and clubs had another strong month, recording 30.5 per cent growth when compared to July 2019, as Brits socialised in beer gardens and returned to nightclubs for evenings out.
While the travel sector continued to face challenges, it may be reassured by figures indicating that overseas bookings are increasing, as spending on airlines (-56.2 per cent) and travel agents (-66.6 per cent) showed less of a decline than in June (-70.9 per cent and -75.3 per cent respectively).
Meanwhile, the market for UK staycations continued to see promising growth, with spending on hotels, resorts and accommodation rising 7.8 per cent – its highest growth since before the first coronavirus lockdown.
However, there are signs that the initial pent-up demand from lockdown is cooling off in certain sectors. For example, restaurant spending had been improving steadily since restrictions began to ease in March, closing the gap on 2019, but last month there was a dip in spending and the gap widened again to -13.1 per cent.
In contrast, takeaways saw record growth of 72.3 per cent – the highest since before the onset of the pandemic – as friends and families watched events such as the Euros and Wimbledon at home while treating themselves to food deliveries.
Spending on non-essential items also recorded its highest growth since before the first UK lockdown, rising 10.4 per cent. This comes as one in four (25 per cent) consumers say they have been dipping into their savings to make the most of post-lockdown life – a figure that rises to 39 per cent among 18–34-year-olds.
The entertainment industry saw growth for the first time in over 16 months, up 8.1 per cent, as consumers bought tickets to the theatre, cinema and sporting events. This comes as 32 per cent of Brits say they expect to spend more on leisure activities and day trips this summer, and 16 per cent plan to spend more attending shows and events – a welcome sign that further growth may be on the horizon.
While confidence in household finances held up at 72 per cent, confidence in the UK economy has dipped slightly, down 3 per cent to 33 per cent. This comes as six in 10 (61 per cent) consumers are worried that everyday expenses will increase as restrictions lift, and more than half (55 per cent) say they are being much more careful to seek value in the purchases they make.
Raheel Ahmed, Head of Consumer Products, said: “July’s major sports fixtures and the heatwave kept the nation in good spirits, providing more reasons to celebrate together, and giving the entertainment industry its long-awaited boost back into growth.
“While some sectors took a small step back as the post-lockdown ‘honeymoon’ period cooled, July was a positive month overall. However, with inflation expected to rise, it will be interesting to see how this impacts consumer spending behaviour over the coming months.”
