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Christmas spending in the UK to drop by £9.6bn due to second lockdown

Abigail Fenton
·Writer
·2-min read
(Hert Niks/Unsplash)
Christmas spending was previously expected to increase by about £1.3bn compared with last year, according to a study. Photo: Hert Niks/Unsplash

Christmas spending in the UK is forecast to plummet by £9.7bn ($12.6bn) during the six weeks to Christmas this year, due to further COVID-19 lockdowns, according to a study.

With non-essential stores closed until 2 December as part of the new restrictions, spending will likely drop 11.6%, compared with the same six-week period last year, VoucherCodes’ Shopping for Christmas 2020 report suggests.

Prior to prime minister Boris Johnson's announcement on Saturday 31 October, Christmas spending was expected to increase by £1.3bn compared with 2019.

A sharp rise in online sales is predicted due to the closure of many physical stores.

Online sales are now forecast to make up nearly half (48%) of the total retail sales, growing by a staggering £13bn (58%) since 2019, according to a study by the Centre for Retail Research (CRR).

READ MORE: Christmas money saving tips – seven things you need to know

Meanwhile, offline spending is predicted to drop by £22.7bn (37%) since last year. However, it will still make up over half (52%) of total retail sales, due to certain items being available in shops that are open, such as supermarkets and pharmacies.

On average, Brits are expected to spend £1,049.01 each this Christmas, the analysis found.

Londoners forecast to shell out the most, at £1,537.89 each.They are followed by those in the South East (£1,273.85), East of England (£1,163.25), and the South West (£1,095.28).

According to the report, the drop in spend is due to the closure of non-essential shops, growing fears about the future, and logistical problems that “will likely be faced by online businesses trying to cater for such an increased demand.”

Important gifts that previously would have been purchased in-store will now be bought online including electronic goods, children’s toys, clothes and footwear, the study found.

READ MORE: UK lockdown shopping tips as shoppers face nightmare before Christmas

“With physical stores closing and people staying at home for at least four weeks, the rapid shift to online shopping is to be expected,” said Anita Naik at VoucherCodes.

“Consumers have already started shopping for Christmas to ensure they don’t go without, and non-essential stores have been busier than they were in the run up to Christmas 2019.

She added: “However you choose to shop, it’s worth taking into consideration that retailers will be offering extra special discounts during the Black Friday period and in the run up to Christmas, so make sure you shop around for the best deals.

“It’s also worth remembering that stores will be trying to fulfil much higher demand than usual online, so make sure you shop early so all your gifts arrive in time.”

Watch: Will England's lockdown stretch to Christmas?