After facing a decline in April, the retail sector experienced a significant rebound in May, according to ONS data.
- The Office for National Statistics (ONS) reported a 2.9% rise in retail sales for May, following a 1.8% decline in April influenced by adverse weather conditions.
- Clothing and textiles sales surged by 5.4%, contributing significantly to the overall sales increase observed in May.
- Despite the recent growth, the ONS acknowledged that sales volumes decreased by 0.2% compared to the same period last year.
- Experts highlight that improvements in consumer confidence and reductions in recessionary behaviors are driving recent economic activity.
In a notable turnaround, retail sales in May rose by 2.9%, marking a recovery from the 1.8% dip recorded in April. The adverse weather conditions during April had considerably impacted sales, particularly within the clothing sector. However, May witnessed a strong recovery, as reported by the Office for National Statistics (ONS).
The increased retail activity was primarily driven by textiles and clothing sales, which saw a notable rise of 5.4%. Additionally, department stores contributed to the upward trend, recording a 1.7% increase. The period from 28 April 2024 to 25 May 2024 captured this growth, providing a clearer picture of the sector’s performance.
Despite the month-on-month improvement, there remain underlying challenges. For instance, when compared to the same three-month period in the previous year, sales volumes actually dropped by 0.2%. The ONS cited the additional bank holiday in May 2023, celebrating the King’s coronation, as one factor influencing these metrics.
The broader economic context is shaped by the ongoing cost of living crisis and persistent inflation, which had maintained levels above the Bank of England’s target until recently returning to the 2% benchmark. These factors continue to weigh heavily on consumer spending and retail performance.
Oliver Vernon-Harcourt, head of retail at Deloitte, noted the positive effects of the consecutive May bank holidays on retail sales. He observed that such conditions have led to a resurgence in consumer spending on discretionary items like clothing and furniture. Additionally, there is evidence suggesting that some recessionary behaviors, which had previously hindered spending, are beginning to wane.
Looking forward, the retail sector remains optimistic about maintaining this momentum amidst the economic uncertainties. The onset of the summer sports season and improving weather conditions are expected to bolster consumer confidence and spending further. However, there is a need for sustained economic recovery to ensure that the current trends in spending are not short-lived.
The substantial rise in May’s retail sales signals a positive shift in consumer behavior, yet economic challenges linger.
