Consumer confidence fails to rebound despite government schemes
Despite the Eat Out to Help Out scheme, consumers are still pessimistic about economy recovery but are feeling more confident about bigger purchases.
Consumer confidence is failing to rebound in the UK despite lockdown continuing to ease and the government attempting to boost spending with schemes such as ‘Eat Out to Help Out’.
GfK’s consumer confidence index remained at -27 in August. The score for the general economic situation over the next 12 months decreased by one point to -62; this is 28 points lower than in August 2019.
The UK government has gradually been reopening the economy, with casinos, beauty parlours and bowling alleys the latest.
It also launched Eat Out to Help Out, a scheme to encourage the public to support the struggling restaurant industry as the economy looks to recover from the coronavirus lockdown. People who dine out from Monday to Wednesday in August will get 50% the price of their meals, up to the value of £10 a head.
Despite this encouragement, the expectations for the general economic situation over the next 12 months are the same, down by one point at -42 points and four points lower than August 2019.
GfK’s client strategy director, Joe Staton, says: “Consumer confidence is clearly not improving as we’d all hoped it would. Daily announcements of job cuts being made by household names – the latest of them high street favourites John Lewis, Marks & Spencer and Pizza Express – are reminding people that there are no certainties in this new world.
“The UK recently went into recession for the first time in 11 years and the threat to jobs across a whole swathe of industries suggests consumers will feel worried for some time.”
People’s feelings about their personal financial situation over the last 12 months is down one point to -5; this is four points lower than August 2019. Despite this downturn, the forecast for personal finances over the next 12 months is up one point to +1 this month – although still one point lower than last year.
The major purchase index has increased by one point to -25, but this is still 26 points lower than at the same point last year.
Stanton adds: “The picture for personal finances for the coming year has improved slightly and crept into positive territory. The major purchase index is also up a point, but this offers little solace to marketers as the measure is still sharply negative at -25.
“It looks like a long hard slog to the end of the year and probably beyond, so marketers will need to find reasons for consumers to be cheerful.”