UK retail records sixth consecutive month of growth in October

Tom Belger
·Finance and policy reporter
·2-min read
People shopping in Leeds city centre, ahead of a national lockdown for England from Thursday.
Shoppers in Leeds before England's lockdown as UK retail sales are released. Photo: PA

UK retail sales recorded a sixth consecutive month of growth in October, defying analysts’ predictions of decline as consumers began their Christmas shopping early.

Sales volumes increased 1.2% between September and October, according to Office for National Statistics (ONS) data released on Friday.

Growth has not been split evenly between retailers, with online sales up 5.8% and store sales down 3.3% versus February. Clothing sales and fuel sales remained below pre-virus levels.

The British Retail Consortium (BRC) had also highlighted strong growth in its own industry figures earlier this month, though warned many non-food retailers saw double-digit declines in sales year-on-year in October.

The overall growth comes in spite of more office workers returning to home working last month, and tighter restrictions also being imposed on parts of the country including Wales, Northern Ireland and London last month as infection cases grew. The rate of sales growth was lower than in September, where it had risen 1.5% month-on-month.

READ MORE: UK inflation ticks higher in October as average prices rise 0.7%

The figures reflect the period before ‘non-essential’ retail was ordered to close across England in early November, however.

The shutdown is expected by the BRC to cost retailers £2bn ($2.6bn) of sales a week, with the trade body urging the UK government to commit to retail fully re-opening in early December. Meanwhile retail data firm Springboard predicts a 59% year-on-year decline in footfall at bricks-and-mortar shopping areas on Black Friday next week.

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Samuel Tombs, chief economist at Pantheon Macroeconomics, expects a 10% decline in sales volumes overall in November compared with October, leaving them below January levels but marking a smaller drop than the first UK lockdown.

He noted the ‘essential’ retail category was slightly larger than earlier this year, while click-and-collect is allowed and small retailers are thought likely to have improved their online operations.

The BRC said food, gifts and loungewear sales were strong in October, however, and boosted at the end of the month in England as consumers prepared for lockdown.

Retail sales in October versus February. Chart: ONS
Retail sales in October versus February. Chart: ONS
Retail sales in October versus February. Chart: ONS
Retail sales in October versus February. Chart: ONS

Tombs predicts a 16% month-to-month jump in sales in December, pushing them above pre-virus levels with Christmas shopping concentrated in a few short weeks in England.

Separate new analysis by Labour suggests non-food retail sales between January and September were down £16.5bn on the previous year. Shadow business secretary Lucy Powell urged more government support for firms, warning many were “hanging on by their fingertips.”

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