The remarkable surge in retail sales reported by Office for National Statistics last week may have been a statistical blip, to judge from the outcome of the latest distributive trades survey from the CBI.
This did show a recovery in late May and early this month from very bleak findings in April, which may have been depressed by an early Easter and dismal weather – but nothing like the month-on-month leap recorded in the official statistics.
The CBI described June as “another difficult month for the high street”, in which 39 per cent of shopkeepers said their sales were down year on year, and 30 per cent reported an increase.
This adverse balance of minus nine per cent was an improvement on minus 14 per cent in May and a bombed-out minus 26 per cent in April.
Ian McCafferty, the CBI’s chief economic adviser, said minus nine per cent in the CBI’s survey indicated was equivalent to growth of about two per cent on ONS’s measure of sales volume – not a decline.
“May was less difficult than April, but not on the scale that the NS finding represents,” he said. “That is not to say that we are right and the ONS are wrong. But we are more in line with the others.”
The recovery for May reported by the British Retail Consortium was much more muted, he pointed out, while the Bank of England’s regional agents have reported a continuing decline in year-on-year growth in the money value of retail sales. Mr McCafferty also pointed out that ONS frequently revises its retail numbers and that it changed the panel of shopkeepers from which it draws it data at the turn of the year.
Andy Clarke, retail director of Asda and the new chairman of the CBI distributive trades panel, pointed to a change in shopping habits as household budgets are squeezed and a clear difference between the trend in food and non-food purchases.
The CBI survey showed supermarkets and other grocers reporting year-on-year increases outnumbered those with a drop in sales by 67 per cent of the sample.
The only other sector to show growth was footwear and leather goods.
“Grocers have had another strong month,” Mr Clarke said. “We are seeing people spend more in supermarkets on the essentials and also upgrade to higher value food ranges instead of having a night out.”
He added. “There is no doubt the consumer has got less disposable income. We can see a swing into value.”
Motor dealers suffered their first setback since January and expect another bad month in July. An adverse balance of minus 26 per cent reported lower sales than in June last year after positive showings of 30 per cent in May and 29 per cent in June.
Sales of both vehicles and parts and accessories were hit.