Shopping trips set to drive post-lockdown economic recovery

According to Deloitte’s Consumer Tracker ‘going to a shop’ topped the list of leisure activities consumers are most likely to do after lockdown, with 63% saying they’d plan to return within a month of lockdown restrictions easing.

The rising appetite to return to shops came alongside the biggest jump in consumer confidence that Deloitte’s tracker has registered since it was launched 10 years ago, with consumer confidence levels up 6% overall in the first quarter of 2021 to -11%.

Every measure of confidence registered year-on-year and quarter-on-quarter growth, with the vaccine rollout driving an 8% uplift in sentiment around health and wellbeing on a quarterly basis to -26%.

Shopper sentiment around the state of the UK economy also registered a 12% uplift in confidence on a quarterly basis to -61%, making it the strongest performing measure on a quarter-to-quarter level.

In year-on-year terms confidence around household income registered the strongest rise, up 17% to -10%, while sentiment around levels of debts entered positive territory for the first time on record at 1%, up 1% and 7% on a quarter-on-quarter and year-on-year basis respectively.

Deloitte chief economist Ian Stewart commented: “The UK is primed for a sharp snap back in consumer activity. High levels of saving, the successful vaccination rollout and the easing of the lockdown set the stage for a surge in spending over the coming months.”

Separate research from the EY Item Club suggested that the UK economy is set to grow at its fastest rate on record in 2021. The economic forecast group upgraded its outlook on UK economic growth from 5% to 6.8%, which would mark the fastest rate seen since Office for National Statistics (ONS) records began.

EY Item Club also revised down its unemployment forecast from 7% as predicted in January to 5.8%, as chief economic adviser Howard Archer said the forecast indicated that the economy would “emerge from the pandemic with much less long-term ‘scarring’ than was originally envisaged and looks set for a strong recovery over the rest of the year and beyond”.