In May, consumer card spending grew by just 1% year-on-year in May, a figure that was significantly down from April’s 4.5% growth, and below the latest CPIH inflation rate of 3.5%.

Non-essential spending grew by 2% in May, a substantial drop from the 5.1% growth recorded the previous month.

May’s slowdown in spending coincided with a decline in consumer confidence. Confidence in household finances fell by three percentage points to 67%, while consumers’ confidence in their ability to live within their means fell four percentage points to 56%. Concerns around interest rates also rose by three percentage points to 64%.

Looking ahead to the summer, many are looking to cut back. Nearly half (46%) of UK adults are planning to reduce their discretionary spending, up slightly from 45% in April. 

Grocery spending saw slower growth in May, at just 0.9%, down from a healthy 6.6% boost in April. Supermarkets grew just 0.2%, in light of heavy discounting.

Consumers have been consistently reporting that they are looking to squeeze more value from their weekly shop, and that trend continued in May when 57% said they were actively trying to reduce their grocery bills. Of this group, three in five said they were making use of loyalty schemes, 54% were eyeing up discounted products, and 49% were switching to discount supermarkets.

Consumers are still finding ways to treat themselves, despite ongoing efforts to cut costs. Two in five (40%) UK adults say they still enjoy treating themselves regularly but are finding budget-friendly options. Two in five of these savvy spenders are waiting until the items they want go on sale, 36% are picking up smaller and affordable treats and 24% set aside savings specifically for occasional indulgences.

Speaking about this, Karen Johnson, Head of Retail at Barclays, said: “Consumers are clearly becoming more value-conscious as financial pressures persist, but they’re still finding joy in the everyday – whether that’s a small treat, a garden project, a cinema trip or a carefully planned getaway.”

Barclays’ research shows that ‘shrinkflation’, where products become smaller but cost the same or more than they used to, remains on consumers’ minds. Concerns about ‘shrinkflation’ rose four percentage points in May, to 82%.

‘Streamflation’ (the increasing cost of streaming platforms and digital content) concerns are also on rise, growing four percentage points to 64%, while one in three (33%) feel that the value they receive from their digital subscriptions has fallen in recent months. For those planning to cut back on discretionary spending, 27% listed cancelling subscriptions as a way they plan to save money. 

Spending on digital content and subscriptions grew 5% in May, amid rising worries about ‘streamflation’. The return of Prime Video’s Clarkson’s Farm, Netflix’s starry dramas Sirens and The Four Seasons, and the arrivals of family favourites like Paddington in Peru and The Wild Robot also contributed to a positive month for streaming services.

Cinemas enjoyed a strong month, with spending surging by 19.2% in the month. Blockbusters like Mission: Impossible – The Final Reckoning and Lilo & Stitch drove this upturn, with spending on May 21 (the release date for both of these films) 18.8% higher than the average for the rest of the month.

Last month was the sunniest April since records began in 1910, with an average of 228.9 hours of sunshine across the country.  The first half of May was similarly dry and sunny, but its final eight days saw the weather turn, accounting for 72% of the month’s rainfall. This downturn coincided with the long bank holiday weekend, washing out plans for a weekend of outdoor socialising.

Despite this, garden centres enjoyed another yet another uplift, increasing 7.2% year-on-year. While not quite the 25% growth seen in April, consumers’ newly refreshed gardens will have benefitted from the May showers. 

Despite the dual bank holidays in May, which typically fuel hospitality and leisure spend, the sector only rose by a modest 3.3%. Spending at pubs, bars and clubs increased just 2% - potentially another casualty of the wet weather.

April saw spending at pubs, bars and clubs rise by 6.6%. This boost might also have contributed to May’s slowdown, if those that pushed the boat out last month opted to then rein things in.

On this, Johnson added: “The double Bank Holidays in May and record sunshine will have given non-essential spending a helpful boost, but this was largely outweighed by the rainy weather in the second half of the month, while longer-term uncertainty continues to shape how and where people choose to spend.”

The UK’s sunniest spring on record helped boost spending across pharmacy, health and beauty retailers, up 12.2% - the highest spend growth of any category in May. By way of explanation, there was a 133.2% surge in website visits to the NHS’ hay fever advice page in early May, suggesting many stocked up on antihistamines. 

Barclays has just released its '10 years of Spend' report, which analyses insights dating back to 2015, tracking consumer and economic confidence, and proprietary transaction data, revealing the key trends that have defined behaviour and spending patterns over the last decade, and providing an outlook for the years ahead. Click here to read the full report.