ONS Data Shows Sharp Decline In December Retail Sales

The ONS has reported retail sales data for the period 28th November to 1st January 2022.

• Retail sales volumes fell by 3.7% in December 2021 but were 2.6% higher than their pre-coronavirus (COVID-19) February 2020 levels.

• Non-food stores sales volumes fell by 7.1% in December 2021, with falls in each of its sub-sectors (department stores, clothing stores, other non-food stores and household stores) following strong sales in November; the Omicron variant, which increased rapidly during December, was reported by some retailers as impacting retail footfall.

• Automotive fuel sales volumes fell by 4.7% in December 2021 as increased home working in December 2021 reduced travel; sales volumes were 6.6% below their February 2020 levels.

• Food store sales volumes fell by 1.0% in December 2021; despite the fall in December, volumes were 2.0% above levels in February 2020.

• Online spending values fell in December 2021 by 1.8% when compared with November 2021 but the proportion of retail sales online rose slightly to 26.6% from 26.3% in November, substantially higher than the 19.7% in February 2020 before the coronavirus pandemic.

• Between 2020 and 2021 the volume of retail sales rose by 5.1%, which is the strongest growth since 2004 (when it was also 5.1%); it was last higher in 2002 (5.7%). However, growth between 2020 and 2021 should be interpreted with caution given restrictions on travel and non-essential retail which contributed to a fall in sales during 2020.

Commentary:

Responding to the latest ONS Retail Sales Index figures, which showed 5.3% year-on-year sales growth in November (non-seasonally adjusted retail sales excluding fuel: J3L2), Helen Dickinson, Chief Executive of the British Retail Consortium, said:

“The spread of Omicron may have slowed Christmas spending, but the perseverance of retailers helped deliver a successful Christmas for consumers. Retail workers pulled out all the stops to overcome supply chain issues, including an ongoing shortage of lorry drivers, to keep customers’ homes stocked with festive items. Growth in food outperformed non-food as many categories that had seen growth in November fell into decline, including furniture and household appliances.

“Customers face strong headwinds in 2022, with energy prices and National Insurance contributions both set to rise. The remaining disposable income also faces greater competition from a resurgence in tourism, eating out, sport and live music. Rising inflation is reducing consumer demand while increasing the costs for businesses. Retailers face rising wage bills, increased transport costs, and increased checks and documentation as a result of new import controls, all of which are forcing up prices at the checkout.”

Source : ONS

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