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UK retail sales see biggest monthly gain since start of COVID

·3-min read
SOUTHEND, ENGLAND - APRIL 12: People walk on the high street under a bridge with a banner saying
People returned to the high street in droves as lockdown restrictions lifted in England. Photo: John Keeble/Getty Images

Brits returned to the high streets in droves in May, as COVID-19 restrictions were relaxed, and sales surged by the highest level since COVID-19 began.

According to the British Retail Consortium (BRC) and KPMG monthly retail sales monitor, total sales in May increased by 10% compared with the same month in 2019.

COVID has had a dire effect on the high street, as non-essential retailers and hospitality closed their doors for the best part of 15 months.

Pent-up demand among consumers has meant a high street splurge, with furniture and homeware sales leading the way. Clothing and footwear sales also recovered.

Watch: Queues form outside Primark in London as non-essential shops reopen across England

Meanwhile, clothing sales were bumped by more than 100%, as Brits readied themselves for a return to socialising.

Following the reopening of physical shops, online sales growth fell back to 39% in May compared with a three-month average of 64%. However, it remains significantly higher than pre-pandemic growth of 1.5% in May 2019.

2-year growth of retail sales. Chart: BRC-KPMG
2-year growth of retail sales. Chart: BRC-KPMG

“Although some spend has migrated to high street, there was still high penetration of online spending in May reinforcing the view that the pandemic has seen a step up in online activity as some consumers maintain their use of this channel out of habit and choice and some remain nervous about venturing back into stores," said Paul Martin, UK head of retail at KPMG.

“Retailers now face an interesting few months as they assess how they best entice their customers back to stores and what the right blend of offline and online will be as spending patterns settle in a post-COVIDD world."

"The BRC's figures provide reassurance that the recovery in consumers’ spending still is on track," said Samuel Tombs, chief UK economist at Pantheon Macroeconomics. "The pick-up in the 2019-to-2021 growth rate is a good guide to the underlying trend, as both periods were unaffected by lockdowns and included the first of the May bank holidays, but not the second."

Read more: UK hospitality and retail facing 'economic long COVID'

The BRC monitor backs up data released by Barclaycard this morning, which showed consumer spending rose 7.6% in May compared with the same period in 2019 – the highest growth recorded since coronavirus restrictions began.

The data showed Brits spent more on outfits and beauty products for post-lockdown socialising, with uplifts at clothing (8.5%) and pharmacy, health and beauty outlets (17.8%).

The figures come following a dour warning from business bosses at a Treasury select committee hearing on Monday.

Kate Nicholls, chief executive at UK Hospitality said at a Treasury select committee hearing on the economic impact of the pandemic that the British high street is facing "economic long COVID" as a result of the hefty debt burdens businesses have been left with due to the rent moratorium coming to an end.

BRC chief Helen Dickinson also said that the shift to online has been a rapid sea-change for shoppers and retailers, and that clarity of messaging on encouraging people back into cities and onto high streets would be crucial for sustained recovery.

Watch: What is inflation and why is it important?