New data has signalled a renewed fall in consumer spending during May, with expenditure down -0.8% on the year.
The decline followed a +0.3% increase in April, and was the first fall in household expenditure recorded since September 2013.
The figures from the Visa UK Consumer Spending Index (CSI) revealed that clothing & footwear and household goods were amongst the weakest performing sectors during the month, with declines of -5.3% and -4.1% respectively.
The late timing of Easter is likely to have had an impact on figures, says Visa, while a look at the retail channels found that face-to-face spending marked the quickest drop since April 2012, down -5.3%. E-commerce, on the other hand, posted a +6.9% rise in spend after a marginal fall in April (-0.3%).
Visa managing director UK & Ireland, Kevin Jenkins commented on the figures: “Consumer spending fell for the first time in nearly four years in May, following some marked slowdowns in growth since the beginning of the year. Our Index clearly shows that with rising prices and stalling wage growth, more of us are starting to feel the squeeze.
“Retailers of non-essential goods were among the worst hit, with clothing and household goods seeing sharp declines in sales. The experience sectors continued to record some growth, though at much softer rates, suggesting consumers were reining in their discretionary spending.
“Bricks-and-mortar retailers had a particularly challenging month, with sales dropping at the quickest level in over five years, at a time when warmer weather and the May bank holidays would usually drive shoppers on to the high street. Online retailers, on the other hand, fared well, with spend up 6.9%.”