UK high street warned not to expect return of pre-Covid Christmas

theguardian.com:

The number of people visiting UK shops this Christmas could remain almost a fifth below pre-pandemic levels as shoppers struggle with the cost of living crisis, according to forecasts.

Retail footfall in December is expected to be 18% lower than the same month in 2019, said Springboard, a retail data company.

The economy is already in recession, the Bank of England said on Thursday, adding that interest rates are likely to rise further to combat inflation, which is near a 40-year high. Households are braced for steep increases in energy bills on Sunday, even after an energy price freeze by the government that is expected to cost £60bn or more.

“There are just so many headwinds facing consumers at the moment,” said Richard Lim, the chief executive of the Retail Economics consultancy. “It’s inevitable that they’re going to cut back over Christmas and the wider festive period.”

Springboard’s data suggests footfall across all UK retail destinations has moved closer to pre-pandemic levels as the year has progressed. However, it said that trend would reverse through the autumn.

Diane Wehrle, the data company’s marketing and insights director, said the usual drop in spending between August and September would be deeper than usual “due to consumers’ fears over the impact of the rise in energy costs expected in October on their household budgets”.

Springboard predicted that December footfall on high streets and in shopping centres would be down by more than a fifth compared with 2019. That would be a much worse hit than to retail parks, where visitor numbers are predicted to be 6% lower than three years ago. Retail parks tend to be anchored by a large supermarket where consumers shop for essentials like food, and sales have rebounded