Consumer confidence at lowest level since record start
According to a long-running survey, consumer confidence is now weak from its lowest point during the global banking crisis or the Covid shutdown, as life pressures increase.
GfK’s consumer confidence index fell two points to minus 40 in May, its lowest score since records began in 1974.
It comes as unemployment in the UK has hit a 50-year low for the first time with vacancies in the number of job seekers, and inflation driven by rising food and fuel bills have hit a 40-year high.
Pessimism is most severe in relation to the general economy, with consumer confidence falling to minus 63 over the previous year and minus 56 for 12 months.
GFK said the key buying index, an indicator of confidence in buying big ticket items, has now fallen to minus 35 for six months, reflecting the latest “disappointing” set of retail sales figures.
Confidence in personal finance fell three points from the previous year to minus 22 – 18 points over the past 12 months.
Joe Staten, GfK Client Strategy Director, said: “May’s result is one point lower than the previous record in July 2008 when the headline score dropped to minus 39.
“This means consumer confidence is weaker now than in the darkest days of the global banking crisis, the impact of Brexit on the economy, or the Covid shutdown.
“The outlook for consumer confidence is bleak, and nothing on the economic horizon shows cause for optimism anytime soon.”
Linda Allett, UK Head of Retail and Leisure Consumer Markets at KPMG, said: “Certainly the cost crunch is feeling tighter for some consumers than others. Of the people we surveyed, a third of the consumers who Started 2022 with savings, they are dipping into it to help them meet their monthly essential costs.
“But two-thirds of consumers with savings still plan to spend something on what they want in 2022. It’s important for the high street that this group is ready and able to spend in the coming months.”
