Five questions answered on bleak December high street sales figures

Causes and effects.

High street sales figures were down in December despite the festive season official figures show. We answer five questions on the latest high street sales figures.

How much are December sales figures down by?

Newly released seasonally adjusted sales figures for December show a fall of 0.1 per cent compared to the month before, figures from the Office of National Statistics show.

Compared to a year earlier the quantity of goods sold rose by 0.3%, which is worse than expected.

With the exception of 2010 this is slowest year-on-year growth in December sales since 1998.

Which sectors of the industry are down the most?

Clothes and food sales are down most notably. Household goods were down 3 per cent, the biggest decline since January 2010.

Food sales fell by 0.3 per cent from the month before and fashion sales dropped by 3.5 per cent.

Which sectors rose?

Unsurprisingly, online shopping. About 10.6 per cent of December sales were carried out online, up from 9.4 percent the year before. Overall, total online sales were up 15.5% from a year earlier.

The data tallies with figures from research firm Experian that suggested the number of visits to retail websites rose 86% on Christmas Eve, 71% on Christmas Day and 17% on Boxing Day compared with a year earlier, due to many online stores beginning their online sales before Christmas.

What are the experts saying?

“With many household budgets still feeling the squeeze and no signs of economic challenges receding any time soon, this led to a respectable rather than spectacular result during the most crucial trading period of the year,“ Helen Dickinson, director of the British Retail Consortium, told The Telegraph.

"As with our own figures, the internet was the standout performer – our own figures would have shown subzero growth in non-food sales if it hadn’t been for online's significant year on year rise.

“Even food, usually dependable at this time of year, showed a slowdown in growth.This suggests that relentlessly tough times led many to ‘trade down’ to cheaper and own-label brands, but also that many economised so that they had more money to spend treating family and friends with nice presents.”

What is the potential long term effect?

The figures indicate that another recession could be heading Britain’s way. If the economy contracts during the current quarter it would mean the country could experience a third recession in a row.

It also means that more money creation by the Bank of England could occur. The bank could also change its inflation target to allow for higher prices rises, all of which could weaken the pound.

 

High street sales figures were down in December. Photograph: Getty Images

Heidi Vella is a features writer for Nridigital.com

Photo: Getty
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What Jeremy Corbyn gets right about the single market

Technically, you can be outside the EU but inside the single market. Philosophically, you're still in the EU. 

I’ve been trying to work out what bothers me about the response to Jeremy Corbyn’s interview on the Andrew Marr programme.

What bothers me about Corbyn’s interview is obvious: the use of the phrase “wholesale importation” to describe people coming from Eastern Europe to the United Kingdom makes them sound like boxes of sugar rather than people. Adding to that, by suggesting that this “importation” had “destroy[ed] conditions”, rather than laying the blame on Britain’s under-enforced and under-regulated labour market, his words were more appropriate to a politician who believes that immigrants are objects to be scapegoated, not people to be served. (Though perhaps that is appropriate for the leader of the Labour Party if recent history is any guide.)

But I’m bothered, too, by the reaction to another part of his interview, in which the Labour leader said that Britain must leave the single market as it leaves the European Union. The response to this, which is technically correct, has been to attack Corbyn as Liechtenstein, Switzerland, Norway and Iceland are members of the single market but not the European Union.

In my view, leaving the single market will make Britain poorer in the short and long term, will immediately render much of Labour’s 2017 manifesto moot and will, in the long run, be a far bigger victory for right-wing politics than any mere election. Corbyn’s view, that the benefits of freeing a British government from the rules of the single market will outweigh the costs, doesn’t seem very likely to me. So why do I feel so uneasy about the claim that you can be a member of the single market and not the European Union?

I think it’s because the difficult truth is that these countries are, de facto, in the European Union in any meaningful sense. By any estimation, the three pillars of Britain’s “Out” vote were, firstly, control over Britain’s borders, aka the end of the free movement of people, secondly, more money for the public realm aka £350m a week for the NHS, and thirdly control over Britain’s own laws. It’s hard to see how, if the United Kingdom continues to be subject to the free movement of people, continues to pay large sums towards the European Union, and continues to have its laws set elsewhere, we have “honoured the referendum result”.

None of which changes my view that leaving the single market would be a catastrophe for the United Kingdom. But retaining Britain’s single market membership starts with making the argument for single market membership, not hiding behind rhetorical tricks about whether or not single market membership was on the ballot last June, when it quite clearly was. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.