In one of the most disrupted months ever seen in retail, March data reveals the initial impact of the UK lockdown. As retailers reacted to the crisis caused by COVID-19, this initial data highlights a split in the fortunes of different retail subsectors.
COVID-19 devastates retail sector, with signs of worse to come
What was looking like a relatively positive start to the year for retail, has been devastated by the impact of COVID-19, and the unprecedented lockdown measures imposed across the UK.
Footfall across all regions fell by almost 30% and the worst is yet to come, with March results representing only one week of the UK lockdown, which began on 23 March.
While COVID-19 continues to impact supply chains and consumer demand, the headline figures mask even greater impact on some subsectors. Food, being the only substantial sector to maintain a footfall presence throughout the period, experienced double-digit value and volume growth, with a period of stockpiling and panic buying leading to lengthy queues and shortages across many categories.
As customers head to online shopping, non-store retailing and household goods also increased, with very little else for consumers to spend money on. Fashion on the other hand, which was already against the ropes, was the most severely impacted, suffering value and volume declines of over 35% with online sales also declining.
Another month of modest growth in house price growth
The average price of UK property increased slightly in February to £219,583, reflecting modest year-on-year growth of just 1.6%. While labor market conditions were healthy during this period, the impact of COVID-19 was already beginning to cause an increase in unemployment, despite the extensive use of government furlough measures. As borrowing is likely to become more challenging, and with the housing market in effective shutdown, domestic economic house price growth also looks set to remain subdued for some time.
The Bank of England reported that consumer credit grew by £402m in February, an annual growth rate of just 2.3%, which remains below recent trends. These statistics are for February, and the full impact of COVID-19 will only be seen once more up-to-date data is released.