UK retail sales have been falling in recent weeks at the sharpest year-on-year pace since January 2012, according to a survey which highlights the weakness of the consumer sector of an economy stuck in the grip of austerity.
The grim distributive trades survey, published yesterday by the Confederation of British Industry, came hard on the heels of figures last week from the Office for National Statistics (ONS) which showed a 1.3% month-on-month fall in UK retail sales volumes in April.
Subtracting the percentage of retailers reporting in the April 24 to May 15 survey period that sales volumes were higher than a year earlier from that experiencing a fall, a net 11% suffered a decline.
This marked a significant deterioration from the net 1% of retailers reporting a year-on-year fall in sales volumes in the previous monthly survey.
Back in November, a net 33% of retailers had reported a year-on-year rise in sales volumes.
Michael Pearce, assistant economist at consultancy Capital Economics, said that the May reading "represents an unprecedented sixth consecutive monthly decline in the survey balance in its 30-year history".
The year-on-year drop in sales volumes in the latest survey was steeper than had been expected by retailers.
The UK economy dodged a triple-dip recession with a 0.3% rise in gross domestic product in the opening three months of this year, according to ONS figures.
Howard Archer, chief UK economist at consultancy IHS Global Insight, said: "The CBI May distributive trades survey provides a bit of a jolt to growth hopes.
"Following on from hard data showing that retail sales volumes fell 1.3% month-on-month in April, the weak CBI survey for May fuels concern that consumers are limiting their spending in the second quarter, thereby threatening to hold back overall growth.
"While retail sales are clearly being hindered by largely disappointing weather limiting sales of summer fashions and some outdoor goods, the current softness in sales appears to run deeper than this."
Mr Archer added: "It looks like consumers are holding back on their spending in reaction to recently higher inflation overall and muted earnings growth. On top of this, employment has edged back from the peak levels seen at the end of 2012.
"Clearly, how much consumers spend over the coming months is crucial as to whether the economy can build on the 0.3% quarter-on-quarter growth achieved in the first quarter, and the prospects for this look mixed."
The CBI survey showed a renewed weakening of trading in the grocery sector, which reported a modest year-on-year fall in sales after posting a sharp annual rise in the previous survey.
Specialist food and drink stores meanwhile reported a sharp year-on-year fall in sales volumes for a second consecutive month.
Clothing retailers reported a sharp year-on-year fall in sales for a third consecutive month, although the rate of decline eased. Sales of durable household goods also showed a sharp year-on-year fall. In contrast, the CBI survey showed another sharp year-on-year rise in sales by furniture and carpet retailers.
Mr Pearce said: "May's CBI distributive trades survey provides another reason to think that the retail sector has lost momentum in the second quarter.
"Falling employment and negative pay growth means retailers continue to face an uphill struggle for sales."
On a more positive note, a net 10% of retailers forecast sales volumes next month would be higher than last June.
Retailers meanwhile reported their overall employment levels were unchanged from a year earlier.
Barry Williams, chair of the CBI distributive trades survey panel said: "Retail sales growth has weakened since the start of the year as households continue to feel the pinch, with wages failing to keep pace with the cost of living.
"There is positivity from retailers this month, however, with sales expected to rise in the coming months."
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