High Street suffers longest-ever downturn

THE crisis engulfing the High Street inten- sified over Christmas and left retailers in their worst run since records began almost a quarter of a century ago.

In a bleak update, the office for National Statistics said retail sales fell 0.6pc in December as shoppers remained cautious over the festive period despite heavy discounting.

It followed a 0.8pc fall in November and was the fifth consecutive month of no growth – the longest such run since records began in 1996.

Analysts described the figures as ‘shockingly weak’.

Howard Archer, chief economic adviser to the ey Item club, said: ‘Consumers were clearly very reluctant to spend over the crucial Christmas.’

Sales in food stores fell 1.3pc, department stores suffered a 1.8pc decline, and shoe shops and fashion chains saw a 2pc drop.

High Street giants John Lewis and Marks & Spencer have already admitted they struggled over Christmas while sales were also down at Sainsbury’s and Morrisons.

online sales continued to outperform the High Street, but there was a significant slowdown, with growth of just 1.6pc in December compared with the previous month.

The figures sparked fresh speculation that the Bank of england will cut interest rates at the end of this month to kick-start the stuttering economy.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the figures were ‘shockingly weak’ and added: ‘December’s fall in retail sales volumes comes as a major shock and suggests that consumers retrenched severely at the end of last year amid heightened political uncertainty.’

Accountancy business BDo said 140,000 retail jobs were lost last year as 16,073 stores shut.

Debenhams, Mothercare and LK Bennett were among the chains that fell into administration in 2019.

The crisis has been highlighted by the Mail’s Save our High Streets campaign that, among other things, has called for sweeping reforms to business rates.

Sophie Michael, head of retail and wholesale at BDo, said: ‘2019 was another tough year for the High Street.

‘There have been huge job losses across the country, with a number of high-profile brands disappearing from our high streets forever.’

Richard Lim, chief executive of Retail economics, said: ‘These numbers paint a pretty bleak picture for Christmas trading, especially for the food sector.

‘It’s becoming increasingly clear that shoppers are happily shying away from the main grocers in favour of the discounters as they prioritise value over range.

‘what’s more, the backdrop of healthier household finances has not benefited the retail industry as consumers remain very cautious in their discretionary spending.

‘Shoppers’ propensity to spend remained weak as uncertainty around Brexit and a weaker economy has severely undermined their confidence.’