Retail sales decline but remain above pre-covid levels

UK retail sales volumes declined by 3.7 per cent last month but were 2.6 per cent higher than their pre-pandemic February 2020 levels, according to the latest ONS figures.

After a strong previous month, non-food store sales volumes were down 7.1 per cent in December 2021, with declines across every sub-sector, including department stores, clothing stores, other non-food stores, and household stores. Some retailers have blamed the impact of Omicron on footfall for the lower numbers.

Food store sales also fell by 1 per cent in the last month of 2021. Despite the fall, volumes were still 2 per cent higher than February 2020 levels.

During the same period, the proportion of retail sales online rose slightly to 26.6 per cent from 26.3 per cent in November, substantially higher than the 19.7 per cent in February 2020 before the coronavirus pandemic.

ONS said that between 2020 and 2021 the volume of retail sales rose by 5.1 per cent – which is the strongest growth since 2004, when it was also 5.1 per cent. However, it warned that 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.

“Off the back of a disappointing Autumn and a turbulent 2021, retailers will be feeling the January blues after sales unexpectedly dropped in the run up to Christmas,” said Lynda Petherick, head of retail, Accenture UKI. “The rapid emergence of the Omicron variant in December triggered a mass anxiety among shoppers, with the risk of missing out on Christmas plans outweighing the appeal of a trip to the shops.

“Despite the drop potentially being attributed to sales having been brought forward into October and November as shoppers locked in purchases early, this will be scant consolation for retailers. They will be bitterly disappointed that they couldn’t capitalise on one of the most important months in the retail calendar.”

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