UK shoppers give retail sales another boost in September

Shoppers gave UK retail sales an unexpectedly big boost last month, increasing spending at the fastest annual rate in more than a year with purchases at supermarkets and furniture stores leading the way.

Retail sales in September were 4.7 per cent above their level in the same month last year, marking the fastest pace of growth since April 2019, according to data from the Office for National Statistics.

Spending came in 5.5 per cent above the level immediately before the pandemic in February.

The figures suggest consumers continued to support the UK’s fragile economic recovery in September, but economists say the new round of Covid-19 restrictions across the UK pose a severe threat to growth.

Month-on-month retail sales rose 1.5 per cent from August, the fifth consecutive expansion following a record contraction in April. Economists polled by Reuters had expected September growth of just 0.4 per cent.

Jonathan Athow, deputy national statistician for economic statistics, said: “Food stores and online retailers have fared particularly well in recent months, and most other store types have now recovered to pre-pandemic levels too after being subject to temporary closures during restrictions in the spring. Spending on home improvement and gardening items in particular have boosted sales”.

Sales volumes in household goods stores were 11 per cent above February levels. 

However, the retail sales figures might give a misleading impression of the overall strength of the consumer economy, as some shoppers have been buying more food and drink at supermarkets because they have been spending less on dining out.

Duncan Brewer, retail expert at the consultancy Oliver Wyman, said: “Fresh lockdowns across the country mean that many consumers will tighten their purse strings, even in the lead up to Christmas.”

But while many risk losing their jobs, there will also be “affluent shoppers, flush with savings from months of working from home, who will treat themselves and their close families”, he said.

The proportion of online sales remained high at 27.5 per cent in September, 7 percentage points above its February level, as consumers who shifted to ecommerce during the lockdown continued to buy online even after shops reopened.

At food stores the proportion of online sales nearly doubled from 5.4 per cent in February to 10.4 per cent in September.