Household woes spell misery for high street

THE lack of consumer confidence caused by the UK’S general economic troubles is writ large in the latest sales figures from the Scottish Retail Consortium.

On the face of it, a 0.8 per cent year-on-year rise in the total value of retail sales in Scotland in March might not look so bad. However, when you take into account the fact that Easter fell earlier this year than in 2017 and thus provided a major boost to March’s sales figures, the underlying weakness is clear.

Obviously, the freezing temperatures and heavy snow which arrived in Scotland in late February and early March with the ‘Beast from the East’ weather system were just about the last things hardpressed retailers needed.

However, weather aside, it is clear the main driving force of retailers’ woes is the huge squeeze on the finances of households, which have been weighed down by years of austerity and long periods of falling pay in inflation-adjusted terms.

The surge in inflation resulting from sterling’s postbrexit vote weakness has taken a heavy toll on households. This continuing pressure is underlined in official average earnings figures published yesterday, which show a 0.2% year-onyear, real-terms fall in pay in February for households in Great Britain.

And the deeper economic woes arising from the Brexit vote, and uncertainty over what the future holds, appear to be adding significantly to consumers’ fears.

The big problem for retailers remains that, while there are plenty of downside risks, there is absolutely no sign of a catalyst to make things better.