UK clothing sales fell last month, consumers still cutting back

British high street spending was slower during a very un-summery August, two reports showed on Tuesday. But cinemas did well due to ‘Barbie’ and ‘Oppenheimer’, while international travel spending held up and that helped boost pharmacy, health & beauty stores.

That’s according to Barclays, which said consumer card spending grew 2.8% year-on-year in August, well below July’s 4% rise and also below the 6.4% inflation figure.

It was another challenging month for clothing, which was down -0.7%, albeit a less significant drop than that seen in July (a 3.1% fall).

Meanwhile, spending at pharmacy, health and beauty stores was up by 5.2%, likely boosted by holidaymakers buying items for their trip.

Barclays said 19% of consumers say that spending on luxury items and/or experiences remains a priority and holidays abroad are hugely important to this group.

But many people are cutting back on non-essentials with 52% of them saying that their discretionary spending has been hit due to rising household bills. And 59% are reducing their spend on new clothes and accessories.

Barclays’ regular monthly survey also showed Britons were unhappy about ‘skimpflation’ where products have seen a downgrade in terms of either quality or quantity in order to avoid raising prices.

And this hasn’t only affected food and drink. Shoppers have also noticed it in “the declining quality of clothing”, commented on by 44% of those surveyed, and toiletries/cosmetics (37%).

Barclays said some Britons are already looking ahead to their Christmas shopping plans too and 31% expect this coming Christmas to be more expensive than last year, while 19% are worried about being able to keep up with costs. Some 17% have also started to put money aside to help fund their festivities.

Meanwhile, the monthly British Retail Consortium-KPMG report said UK total retail sales increased by 4.1% in August, against growth of 1% in August 2022. But again, that lagged inflation and was largely driven by higher food sales.

The report looks specifically at retail sales rather than overall consumer spending. 

Non-Food sales actually fell 0.2% on a total basis over the three-months to August. This is below the 12-month average growth of 0.9%. For August alone, “non-food was in growth year-on-year”, although we’re not told by how much.

That said, clothing fell, although as noted by Barclays, health and beauty rose.