Retail spending in the UK fell by 0.8% in 2022 compared with the previous year, according to data from Barclaycard. Despite the number of card transactions rising by 5%, the total amount spent declined as high inflation reduced basket sizes.
The cost of living crisis, driven by a 33% increase in energy bills, forced households to become more selective. Barclaycard reported that consumers cut back on subscriptions and home improvements to manage their budgets.
Overall consumer spending, which includes hospitality and travel, grew by 10.6% in 2022, up from 5.9% in 2021. Spending in restaurants rose by 37%, bars and clubs by 57%, and travel agents by 190%, as pandemic restrictions eased.
Grocery spending slipped by 0.1% despite food-price inflation exceeding 16%. Shoppers increasingly switched to unbranded or supermarket brands and reduced impulse purchases.
Esme Harwood, a director at Barclaycard, noted that while hospitality and travel benefited from the lifting of restrictions, the retail sector faced a squeeze. Harry Wallop, a commentator, added that consumers are likely to remain cautious in 2023 while still allowing for occasional treats.
