Retail sales rebound 12% in May as shoppers began to return to household goods stores, but High Street is still 13% down on pre-covid levels

Data indicates Tesco, Morrisons and Sainsbury continued strongly but B&Q and Leyland enjoyed a major surge. Digital players such as Boohoo boomed.

Shoppers have been slowly returning

AFP via Getty Images

Jim Armitage @ArmitageJim

19 June 2020

Shoppers flocked back to their local malls and High Streets last month in what was the biggest bounceback in trading ever after April's lockdown was gradually relaxed.

Official data from the Office for National Statistics showed retail sales jumping 12% month-on-month.

However, against February, before Covid hit, sales were down an unprecedented 13.1%.

Analysts said the real test of the retail sector's recovery will only be when figures are published covering the reopenings of stores this week and beyond, but today's data gave an indication of how deep is the trough the economy has to recover from.

Online sales took up a record proportion of shopping, hitting 33.4% of all shops' takings, up from 30.8% in April.

Supermarkets remained relatively steady but there was a 42% month-on-month surge in household goods sales as DIY shops reopened.

The ONS said while there was a strong increase in petrol sales in May as travel restrictions began to be eased, it still remained some 42.5% lower than in February.

Most stores closed from 23 March after official government guidance and the majority only resumed trading this week, although those deemed essential were allowed to open their doors earlier.

Some garden centres and hardware stores were allowed to reopen in mid-May.

Anecdotal evidence has it that stores have seen huge pent-up demand since reopening, with long queues at Primark and Niketown this week.

However, economists are concerned this may not last into the coming weeks and months as unemployment is predicted to rise steeply when the state-funded furlough scheme begins to taper and then finish.

One of the biggest questions to arise from the crisis is whether High Streets and shopping malls will ever recover to their pre-covid levels or whether the shift to online will remain as new digital shopping converts stick with it. In the three months to May, so-called "non-store retailing" - largely online - surged by 24.3% in volume terms.

Across digital and bricks and mortar shops, food stores were broadly flat.

Economists welcomed the figures which were better than most had expected, albeit retail sales data is notoriously volatile. Dr Howard Archer, chief economic adviser to the EY Item Club said: "While the retail sector will clearly benefit markedly from the progressive opening up of the sector in June, it is highly uncertain just how much the sector will bounce back."

He pointed to Springboard data suggesting the overall pick-up in numbers since Monday has been limited and fell back from the first day. He predicted consumer spending would contract by around 17% quarter-on-quarter in the second quarter of the year. Given Britain's economy's reliance on consumer spending, that would be the biggest factor in an expected fall of GDP of around 15% quarter-on-quarter.

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Retail sales rebound 12% in May as shoppers began to return to household goods stores, but High Street is still 13% down on pre-covid levels

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