Retail recovery?

Retail sales, Great Britain: June 2020 – ONS

  • In June 2020, the volume of retail sales increased by 13.9% when compared with May 2020 as non-food and fuel stores continue their recovery from the sharp falls experienced since the start of the coronavirus (COVID-19) pandemic.
  • The two monthly increases in the volume of retail sales in May and June 2020 have brought total sales to a similar level as before the coronavirus pandemic; however, there is a mixed picture in different store types.
  • In June, while non-food stores and fuel sales show strong monthly growths in the volume of sales at 45.5% and 21.5% respectively, levels have still not recovered from the sharp falls experienced in March and April.
  • Food stores and non-store retailing both reached new high levels since the start of the pandemic, with volume food sales 5.3% higher, and non-store retailing 53.6% higher, than February.
  • In the three months to June, the volume of sales decreased by 9.5% when compared with the previous three months, with declines across all store types except food stores and non-store retailing.
  • The proportion of online spending reduced to 31.8% in June when compared with the record 33.3% reported in May, but is a considerable increase from the 20.0% reported in February.

 

What’s happening in the labour market?

Labour market overview, UK: July 2020 – ONS

For March to May 2020:

  • the estimated UK unemployment rate for all people was 3.9%; 0.1 percentage points higher than a year earlier but largely unchanged on the quarter
  • the estimated UK unemployment rate for men was 4.0%; this is 0.1 percentage points higher than a year earlier but 0.2 percentage points down on the quarter
  • the estimated UK unemployment rate for women was 3.8%; this is 0.2 percentage points higher than a year earlier and 0.1 percentage points higher on the quarter

A larger than usual proportion of those leaving employment are not currently looking for a new job and therefore becoming economically inactive, rather than unemployed. In addition, an increased number of respondents who were previously unemployed have moved to economic inactivity in March to May 2020, suggesting that some who were previously unemployed are no longer looking for work.

For March to May 2020:

  • the estimated economic inactivity rate for all people was 20.4%; this is down by 0.4 percentage points on the year but up 0.2 percentage points on the quarter
  • the estimated economic inactivity rate for men was 16.5%; this is up by 0.1 percentage points on the year and up a joint record high of 0.5 percentage points on the quarter
  • the estimated economic inactivity rate for women was 24.3%; this is down by 0.9 percentage points on the year and down by 0.1 percentage points on the quarter

Those who are economically inactive and who want a job increased by a record 257,000 on the year and a record 253,000 on the quarter, while those who do not want a job decreased by a record 414,000 on the year and 161,000 on the quarter. This suggests that people who want employment are not currently looking for work, and further explains why we are not seeing a large rise in unemployment.

For March to May 2020:

  • the estimated employment rate for all people was 76.4%; this is 0.3 percentage points up on the year but 0.2 percentage points down on the quarter
  • the estimated employment rate for men was 80.1%; this is 0.1 percentage points down on the year and 0.4 percentage points down on the quarter
  • the estimated employment rate for women was 72.7%; this is 0.7 percentage points up on the year but largely unchanged on the quarter

Despite the estimated fall in employment of 126,000 on the quarter, the estimated number of redundancies has not increased significantly over the period. Instead, experimental estimates based on returns for individual weeks suggest the number of respondents starting a new job declined greatly through the March to May period compared with the same period in previous years.

No growth in Q4 but better in 2019 as a whole

GDP monthly estimate, UK: December 2019 – ONS

  • UK gross domestic product (GDP) was flat in Quarter 4 (Oct to Dec) 2019
  • Growth in both services and construction was offset by a fall in production, which resulted in 0.0% GDP growth in the three months to December 2019
  • Rolling three-month growth weakened for the third month in a row in December 2019
  • Headline GDP grew by 1.4% in 2019

 

Community ownership of vacant shops: can this save the High Street?

Take Back the High Street: Putting communities in charge of their own town centres – Power to Change Report 

Greater community ownership of high street properties could lead to many fewer empty shops, compared to ownership by private-sector interests such as real estate companies and overseas investors.

  • Shops owned by overseas investors are more than twice as likely to be vacant as shops owned by the public sector
  • Real estate companies own one in four of all empty shops, and overseas investors own one in five; whereas the public sector and social sector [2] own around one in ten each
  • Just 8% of units owned by the social sector are vacant, and 4.5% of those owned by the public sector – compared to 9.2% for real estate companies, 9.6% for overseas investors, 11.9% for institutions like pension funds, and 13% for investment management schemes

Consumer Spending: the lowest increase since records began

CONSUMER SPENDING LEFT LANGUISHING: British Retail Consortium (BRC)

Covering the four weeks 30 June – 27 July 2019

  • On a total basis, sales increased by 0.3% in July, against an increase of 1.6% in July 2018. This is the lowest figure recorded for the month of July since BRC records began in 1995 and comes after the worst June on records. This is above the 3-month average of -1.3% but below the 12-month average of 0.5%. This is the lowest 12-month average on records.
  • UK retail sales increased by 0.1% on a like-for-like basis from July 2018, when they had increased 0.5% from the preceding year. This is above the 3-month and 12-month averages of -1.5% and -0.2% respectively.
  • Over the three months to July, in-store sales of Non-Food items declined 4.1% on a Total basis and 4.0% on a like-for-like basis. This is worse than the 12-month Total average decline of 2.6%.
  • Over the three months to July, Food sales decreased 1.0% on a Like-for-like basis and 0.3% on a Total basis. This is below the 12-month Total average growth of 1.8% and the lowest 3-month average since December 2014, excluding Easter distortions.