Only a third of Britain’s shoppers have no spare cash?
The latest Consumer Confidence survey by the British Retail Consortium has announced that the proportion of British shoppers who feel they have no spare cash has reached a new all time high- at just 32 per cent.
The survey showed that consumers' biggest concerns for the next six months continue to be things that affect their personal finances and household budgets. ‘Increasing utility bills' is the number one concern, followed closely by ‘the economy', and ‘increasing fuel prices'. In response to rising costs, 71 per cent of people say they have changed their shopping habits to try to save on household expenses, with 65 per cent of those switching to cheaper grocery brands. Including and especially toilet paper*
Britain's second quarter consumer confidence index improved as more people felt a little better about their job prospects and personal finances, unless you work for Bitterwallet, but it remains down on all of last year. Nineteen per cent of consumers are now optimistic about their job prospects for the coming year but 73 per cent remain pessimistic. And, while 35 per cent of people are now optimistic about the state of their personal finances, some 60 per cent of Brits remain gloomy about theirs.
British Retail Consortium Director General Stephen Robertson said: "The squeeze on disposable incomes is getting tighter. A third of people said they have no spare cash – a new record high. Weakness in the economy and rising utility, fuel and food bills top consumers' concerns for the next 6 months.”
"With finances under pressure, consumers are becoming increasingly savvy with 65 per cent saying they are switching to cheaper grocery brands – often own-brand labels – to stay within their budgets. Competition within the sector is helping to take the edge off price inflation with a larger number of promotions and discounts on offer.”
But what about the surprising, given all the doom and gloom, 68% of people who do have cash to splash after all the bills have been paid? “Even after paying out for essentials, households that do have spare cash are choosing to pay off debts and build-up savings rather than spend on the high street,” he added.
Kickstarting consumer spending is vital to the economy, which is why a VAT rate drop is Labour Shadow Chancellor Ed Balls’ preferred strategy. Yesterday’s Sunday Times also predicted that there was a 30% chance that interest rates, which have been at a record low of 0.5% since will fall to 0.25% by February 2012.
So are you one of the haves (spare cash) or have nots? And what would make you spend more?
*I made that last bit up.