YOU can usually rely on Lord Wolfson, chief executive of Next, to offer a pearl or two of economic wisdom when the retailer announces results.

And he certainly did not disappoint yesterday. He grabbed the City’s attention first thing in the morning by warning: “The year ahead may well be the toughest we have faced since 2008.”

For anyone who needs reminding, 2008 was the year in which the UK tumbled into the Great Recession and the global financial crisis wreaked havoc.

It is also worth bearing in mind that, in a macroeconomic context and from the viewpoint of the vast bulk of consumers, the years since 2008 have been anything but bountiful.

Lord Wolfson highlighted the fact that growth in people’s real earnings, a measure which takes into account inflation, had slowed sharply from September last year.

It is worth noting earnings have not been growing in real terms for very long in any case. Households suffered many years of falling real earnings prior to the unconvincing pay growth seen recently.

Lord Wolfson also flagged a broadly-based slowdown in economic growth in the UK during last year.

He said: “The outlook for consumer spending does not look as benign as it was at this time last year. Although employment rates are at record highs, growth in real earnings – the difference between wage growth and inflation – slowed markedly from September last year. In addition, growth in output across services, manufacturing and construction all decelerated throughout the course of the year.”

Lord Wolfson’s comments spooked the retail sector, with shares in Marks & Spencer and Debenhams falling. Next’s own shares dropped sharply, by 15 per cent, as Lord Wolfson’s views on the economic situation appeared to overshadow what the retailer’s chairman, John Barton, noted was a “solid” set of results for the year to January 2016.

In a tough retail sector, Next’s achievement of a three per cent rise in annual sales to £4.1 billion is no mean feat. And the retailer’s underlying annual pre-tax profits rose by five per cent to £821 million.

Lord Wolfson did not stop at his observations about the UK economy, and how the situation might affect overall consumer spending. He also flagged a danger that households might switch their spending away from clothing to other areas.

He said: “In addition to our generally more cautious outlook for the economy, we also believe that there may be a cyclical move away from spending on clothing back into areas that suffered the most during the credit crunch.”

In this context, he cited the latest available figures for consumer spending, for the third quarter of last year.

And he declared: “Although Q3 2015 was a good quarter for clothing, it can clearly be seen that growth in experience-related expenditure such as eating out, travel and recreation was much stronger.”

It is difficult to predict with much certainty how households might reallocate their scarce resources when it comes to spending, although we have seen in recent years that cutting back on food bills has been a priority in these grim economic times.

However, what is clear is that the UK macroeconomic picture is weak indeed.

If anyone needs any further confirmation of this weakness, it is clear from economists having pushed back predictions of the timing of the first rise in UK base rates from their record low of 0.5 per cent to next year.

Meanwhile, official figures have this week highlighted a significant danger that Chancellor George Osborne will overshoot the borrowing projection for the fiscal year ending this month. Public sector net borrowing during the 11 months to February totalled £70.7 billion, close to the forecast figure of £72.2bn for the full year to March.

Many experts remain concerned that Mr Osborne’s austerity programme has been hindering, rather than helping, the economy and public finances.

There does not seem to be much good news at all on the economic front right now, although we should perhaps take some encouragement from the recent rise in oil prices from their worst levels.

The tumble in Next shares indicates the City did not much like what Lord Wolfson had to say about the general economic situation.

That said, there is no getting away from the fact that the reality of the UK economic situation has been pretty unpalatable for years now.

Weighing up the challenges facing Next, Lord Wolfson said: “It may well feel like walking up the down escalator, with a great deal of effort required to stand still. It will not be the first time we have felt this way, and our experience is that the effort put into improving the business in tough times can pay handsome rewards when conditions improve.”

Next has, over the years, developed a reputation for over-delivering in difficult circumstances.

The same, sadly, cannot be said of Mr Osborne and his Conservative colleagues on the economic front, with growth and borrowing having consistently disappointed and the Chancellor’s vaunted “march of the makers” having failed to materialise.

Only last week, the Office for Budget Responsibility (OBR) cut its growth forecasts for the UK economy for every year between now and 2020, which is as far as its projections extend. UK growth is projected to be below the country’s long-term average rate all the way to 2020. The OBR also hiked its projections of public sector net borrowing by tens of billions of pounds.

You would imagine, if Next feels the current economic conditions present a challenge, there must be plenty of companies out there that are feeling pretty demoralised about the macroeconomic backdrop.