Consumer confidence has fallen to record lows - BRC survey
Consumer confidence has fallen to new record lows, according to the latest consumer confidence survey from market research company Nielsen and the British Retail Consortium (BRC).
Eighty four per cent of people in Great Britain now believe the country is in recession, up from 65 per cent in May. Only 18 per cent think the country will be out of recession within a year.
The twice-yearly survey, published today (Monday), asks consumers their thoughts and feelings on job prospects, personal finances, spending intentions and major concerns.
The consumer confidence index for Great Britain has fallen from 79 points in May to 74 in the latest poll. For comparison, the index stood at 94 this time last year and peaked at 101 in spring 2006.
Sixty per cent of people in Great Britain think their own personal finances are 'not so good' or 'bad', 69 per cent of people said that now was 'not a good time' or a 'bad time' to buy the things they want or need and 70 per cent said they thought their job prospects were 'not so good' or 'bad'.
This latest dip in confidence is driven by an increase in the number of people becoming concerned about job prospects. In May, 14 per cent of respondents thought job prospects were 'bad' but in the latest poll almost a quarter (23 per cent) of respondents said job prospects in Great Britain will be 'bad' in the coming 12 months.
When asked about their major concerns, 39 per cent of Britons said that their biggest or second biggest concern was increasing utility bills. All of the top ranking concerns were in relation to the increasing cost of living, debt and the wider economy. Concerns over social issues such as immigration, health, crime and terrorism were not as prevalent.
The survey also highlights that the tourism and leisure industries are likely to be early victims of the economic downturn with a significant drop in people saying they will spend their discretionary income on holidays and going out.
This time last year 37 per cent of people said they would spend their spare cash on holidays; this has now fallen to 28 per cent. Likewise, 26 per cent of people said they would spend spare money on out-of-home entertainment last November with only 18 per cent of people saying this now.
Justin Sargent, Managing Director, Nielsen commented: “This survey reflects the pressures that shoppers have been feeling personally on a daily basis and highlights just how widespread concern is over the burden of increased bills and prices.
Add to that worries over debt and jobs and we see consumer confidence, unsurprisingly, hit new lows. With inflation and interest rates falling Nielsen expect consumers to regain some confidence, though caution will remain.”
Stephen Roberts, British Retail Consortium Director General said: “With only one in five people believing recession will be over this time next year, it's certainly going to be a tough Christmas and New Year. But there are reasons for optimism.
The Bank of England's shock rate cut should get the economy's heart beating again. Some key costs are falling, bringing shop prices down, and retailers are fighting back with promotions and price cuts. This can be good time to be a customer.”
British Retail Consortium