Consumers visited and spent less in UK shops, bars and restaurants in June, according to new data, suggesting the economic recovery lost momentum following a rise in Covid-19 infections.
On Monday, Boris Johnson, prime minister, announced that he intends to press ahead with the removal of all the remaining coronavirus restrictions on July 19 in an attempt to return to normality. But while economists predict the July reopening could deliver another boost to the recovery, they noted that measures of economic activity such as consumers’ mobility, bank transactions and restaurants bookings, fell throughout June or stalled despite eased restrictions as the Delta variant continued to spread.
The lifting of restrictions, the dropping of mask wearing and social distancing, and the increased awareness of low levels of hospitalisation, “should give the economic rebound new impetus over the summer”, said Martin Beck, lead UK Economist, at the consultancy Oxford Economics. But Google mobility data for June show that the number of visits to UK grocery, retail and recreation hubs has dropped in recent weeks, after rising sharply from January’s low as restrictions in the UK have gradually been lifted. Similarly, retail footfall declined throughout June to 25 per cent below June 2019 levels, according to the retail consultancy Springboard.
Maddy Alexander-Grout, chief executive at the loyalty scheme My VIP Card, said that the government’s delay in the final stage of the reopening “had a definite impact on sales in June”. “People’s confidence was hit once again and that translated very rapidly into reduced footfall on the high street,” she added.