Brits flock to cinemas and book summer holidays in June but household budgets continue to tighten amid rising inflation
- Spending on essential items grew 4.4 per cent largely due to climbing fuel prices
- Average spending on utilities was up 39.6 per cent, leading more than two-fifths of Brits to cut back on their energy and water consumption
- Yet, cinemas had a blockbuster month with Top Gun: Maverick and Jurassic World Dominion boosting takings, while holiday bookings gave travel an uplift
- The Barclaycard report combines hundreds of millions of customer transactions with consumer research to provide an in-depth view of UK spending
Consumer card spending grew 6.2 per cent in June compared to the same period in 2021, with the entertainment, hospitality and international travel sectors all enjoying month-on-month uplifts as Brits enjoyed the early summer weather. However, concern around rising living costs continues, with consumers becoming more selective about their spending and feeling less able to live within means each month.
Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, reveals that spending on essential items increased 4.4 per cent, largely driven by a surge in fuel spend (24.8 per cent) as petrol and diesel prices continued to climb.
Shopping at supermarkets and specialist food and drink stores saw year-on-year decreases of -0.8 per cent and -1.1 per cent respectively, with almost half of consumers (49 per cent) seeking more value from their weekly shop – an eight point rise on last month (41 per cent).
As household bills continue to mount, spending on utilities jumped 39.6 per cent year-on-year, representing a 5.1 per cent increase month-on-month (34.5 per cent in May) and leading 44 per cent of Brits to cut back on their energy and water consumption to keep costs down.
Spending on non-essential items was up 7.1 per cent year-on-year, although this was a noticeably lower level of growth than seen in May (11.6 per cent) and April (21.2 per cent), continuing the downward trend seen over the last few months.
However, despite widespread budgeting, several categories are performing well month-on-month. The entertainment industry benefitted from blockbuster bookings at the cinema, as Brits flocked to see Top Gun: Maverick and Jurassic World Dominion, resulting in a 5.3 per cent boost compared to May 2022.
Sports and outdoor retailers (4.9 per cent) and pharmacy, health and beauty (1.9 per cent) also enjoyed strong monthly growth, as did department stores (1.8 per cent) and clothing retailers (2.4 per cent), owing to Brits enjoying more time outdoors in the sunshine and preparing for summer holidays and events.
Brits also remain keen to support the hospitality sector and eat and drink out with friends and family. Although spending at restaurants was down -3.3 per cent compared to June 2021, the category saw a small month-on-month uplift (0.8 per cent), as did bars, pubs and clubs (up 0.1 per cent). Takeaways & fast food remain popular too, recording growth of 2.3 per cent month-on-month and 9.4 per cent year-on-year respectively.
Despite uncertainty over potential flight cancellations, travel agents (6.4 per cent), airlines (2.8 per cent) and hotels, resorts and accommodation (3.3 per cent) all saw monthly growth as holidaymakers booked getaways for the summer.
At home however, digital and content subscriptions saw a decline (-4.2 per cent) compared to May 2022, as Brits prioritised their spending elsewhere. This comes as a quarter (26 per cent) are reviewing their subscriptions and cancelling ones they can live without, with 44 per cent of those making changes to their subscriptions choosing to switch off or make cuts to their film or TV streaming services.
Spending on household goods also saw a noticeable drop compared to May 2022 (-5.1 per cent), with home improvements and DIY as well as furniture stores seeing month-on-month declines of -7.4 per cent and -2.7 per cent respectively, as Brits held-off purchasing certain discretionary items.
More of the nation (91 per cent) than last month (88 per cent) are concerned about the negative impact of rising household bills on their personal finances. Consumers are also feeling less optimistic about their ability to live within their means (66 per cent versus 71 per cent in May), and their ability to spend on non-essential items (48 per cent versus 54 per cent). In addition, confidence in the future of the UK economy has decreased slightly to 25 per cent, down from 27 per cent in May.
José Carvalho, Head of Consumer Products at Barclaycard, said: “The continued rise in fuel, food and energy prices means consumers are having to budget and seek out value where they can for both essential and non-essential purchases.
“While this cautionary approach is impacting supermarket and individual basket spend, there are bright spots to be found, with Brits increasing their discretionary spending on entertainment, travel and takeaways as we head into high summer.”
Jasmine Birtles, Financial Expert, said: "Brits are understandably worried about their financial futures and, in particular, their ability to pay ever-rising bills. However, it looks like many have been able to put their concerns aside for a while and enjoy the good weather, with sports items and summer clothes performing well.
“The hospitality and entertainment sectors have had a tough few years, with lockdowns and now rising inflation, so it’s heartening to see that, for the moment at least, people are going out to eat and enjoying cinema shows again.”
|Spend Growth||Transaction Growth|
|Food & Drink Specialist||-1.1%||11.3%|
|Home Improvements & DIY||-11.6%||-13.3%|
|General Retailers & Catalogues||-9.8%||-7.6%|
|Pharmacy, Health & Beauty||5.6%||10.9%|
|Sports & Outdoor||-12.6%||-10.2%|
|Other Specialist Retailers||-2.8%||2.2%|
|Hospitality & Leisure||35.2%||14.2%|
|Digital Content & Subscription||-2.9%||-1.5%|
|Eating & Drinking||8.6%||15.4%|
|Bars, Pubs & Clubs||6.5%||19.2%|
|Takeaways and Fast Food||9.4%||11.0%|
|Other Food & Drink||12.4%||18.5%|
|Hotels, Resorts & Accomodation||3.4%||14.1%|
– Ends –
Notes to editors
*Starting in June 2022, the monthly Consumer Spending Index has returned to a year-on-year comparison (i.e. comparing June 2022 against June 2021), with some additional month-on-month comparisons (i.e. comparing June 2022 against May 2022) where relevant.
Established in 2014, Barclaycard issues a monthly press release commenting on consumer spending trends.
Barclaycard sees nearly half of the nation’s credit and debit card transactions, which provides us with unique insight into UK consumer spending. The monthly spending data in this press release is based on Barclaycard credit card and Barclays debit card transactions, and is analysed by the Barclays Market and Customer Insights team. It relates to the period 21 May 2022 to 24 June 2022. It is compared with 22 May 2021 to 25 June 2021.
The utilities spend growth data in this press release was calculated using Barclays card and current account data, based on billing dates at the customer level. For this release, Barclays analysed the percentage change in utilities spending per customer between the first 16 Billing Dates of June 2022 vs the First 16 Billing Dates of June 2021.
The consumer confidence survey in this press release was carried out between 24 and 28 June 2022 by Opinium Research on behalf of Barclaycard. There were 2,000 respondents, providing a representative sample of UK consumers by age, gender, region, and income group.
Barclaycard, part of Barclays Bank PLC, is a leading global payment business that helps consumers, retailers and businesses to make and take payments flexibly, and to access short-term credit. In the UK we process nearly £1 in every £3 spent using credit and debit cards, and in 2021 we processed over £270bn in transactions globally. We also partner with a wide range of organisations across the globe to offer their customers or members payment options and credit.
Follow us on Twitter @BarclaycardNews
About Barclays Market and Customer Insights
Barclays Market and Customer Insights helps businesses keep up to date with spending trends, monitors their market position and enhances their understanding of customer behaviour, based on actual customer spending. For further information, please email contact-MCI@barclays.com.