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Brits now spending £1 in every £10 online

October 21, 2011

British shoppers are now spending one pound in every ten online, as consumers’ switch their budgets from shops to sites, according to new official retail figures.

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According to the Office for National Statistics, Britons spent an average of £539.4m online each week in September, out of £5613.9m total sales.
This 9.6% share is the biggest on record, and is more than three times bigger than the 3% share back in early 2007.
The figures came as the ONS reported a surprise increase in sales in September. Economists had expected zero growth in the month, but sales increased by 0.6%, the ONS said.
It reversed a fall of 0.4% in the previous month and will be seen as a rare glimpse of good news for the struggling UK economy. Sales were boosted in particular by a rise in laptop and computer game sales – as well as those internet sales.
However, it seems likely that at least part of the increase in September represented a bounce after August, when sales were depressed by riots and the post-riot clean-up around the UK.
Chris Williamson, chief economist at Markit, said: “With unemployment at 8.1% and set to rise further, the cost of living increasing at the fastest rate for 20 years and household confidence bruised by worries about the economic outlook at home and abroad, retail sales will inevitably be under pressure in coming months. Retailers are facing a challenging lead up to Christmas and the festive season may be one of the toughest yet that we’ve seen in recent memory.”
Sam Tombs of Capital Economics said: “Households have increased their nominal retail spending by more than 5% over the last year to keep pace with inflation, but their earnings have only grown by 2% or so. It therefore seems likely that households have continued to cut back their spending on consumer services sharply (which account for around 60% of overall spending) to support retail spending. Either that or households are saving a smaller proportion of their income – clearly only a temporary source of support for spending.”

Uncategorized Christmas, retail, UK

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