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| Retail sales near pre-lockdown levels in June | Retail sales near pre-lockdown levels in June |
| (32 minutes later) | |
| UK retail sales were near pre-lockdown levels in June, as the reopening of shops released pent-up demand. | UK retail sales were near pre-lockdown levels in June, as the reopening of shops released pent-up demand. |
| The amount of goods sold last month increased by 13.9% compared to May, according to the Office for National Statistics (ONS). | |
| Separately, a closely watched survey showed that activity in the UK's services and manufacturing sectors returned to growth last month. | |
| However, economists warned that the country's recovery would take time. | |
| June's rise in retail sales followed record falls in April and a partial recovery in May as the coronavirus pandemic led to widespread shop closures. | |
| But it masked "big changes" in retail, with food and online sales up, while clothing was still "struggling", the ONS said. | |
| Online sales continued to go "from strength to strength", the ONS added, accounting for £3 out of every £10 spent by consumers. | |
| Demand at food stores remained strong, hitting new highs for the lockdown period. | Demand at food stores remained strong, hitting new highs for the lockdown period. |
| Compared with February, the volume of food sales was 5.3% higher while non-store retailing grew by 53.6%. | Compared with February, the volume of food sales was 5.3% higher while non-store retailing grew by 53.6%. |
| The ONS said the rebound had brought overall retail sales back to a similar level to where they were pre-lockdown, but there was a "mixed picture" in different store types. | The ONS said the rebound had brought overall retail sales back to a similar level to where they were pre-lockdown, but there was a "mixed picture" in different store types. |
| In June, non-food stores, including department stores and clothes shops, partially recovered from strong falls during the lockdown but were still 15% lower than in February. | In June, non-food stores, including department stores and clothes shops, partially recovered from strong falls during the lockdown but were still 15% lower than in February. |
| Non-essential shops in England were not allowed to reopen until 15 June, so they were only trading for half the month. | Non-essential shops in England were not allowed to reopen until 15 June, so they were only trading for half the month. |
| Jonathan Athow, ONS deputy national statistician, told the BBC that there had been "some really big changes under the surface" of the retail landscape since lockdown began. | Jonathan Athow, ONS deputy national statistician, told the BBC that there had been "some really big changes under the surface" of the retail landscape since lockdown began. |
| "Food shops continue to do quite well, as we're eating at home more," he said. | "Food shops continue to do quite well, as we're eating at home more," he said. |
| "But the real growth has been in online sales. Online sales continue to go from strength to strength." | "But the real growth has been in online sales. Online sales continue to go from strength to strength." |
| Britain's nation of shoppers has come to the fore. | Britain's nation of shoppers has come to the fore. |
| The amount of what we buy is virtually back to pre-crisis levels - but that doesn't signal a wider full bounce-back in our economic fortunes. | The amount of what we buy is virtually back to pre-crisis levels - but that doesn't signal a wider full bounce-back in our economic fortunes. |
| This is for a couple of reasons. Firstly, what we buy has changed: more online, more staples, fewer impulse forays onto the High Street. | This is for a couple of reasons. Firstly, what we buy has changed: more online, more staples, fewer impulse forays onto the High Street. |
| While there was an initial flurry in sales of clothing and household goods immediately after non-essential shops opened in June, more timely data on payments suggested that tailed off in July. | While there was an initial flurry in sales of clothing and household goods immediately after non-essential shops opened in June, more timely data on payments suggested that tailed off in July. |
| The fallout can be seen in the mounting job losses announced by stalwarts, from John Lewis to M&S. | The fallout can be seen in the mounting job losses announced by stalwarts, from John Lewis to M&S. |
| Secondly, retail sales are only part of the recovery jigsaw, totalling about a fifth of the economy. | Secondly, retail sales are only part of the recovery jigsaw, totalling about a fifth of the economy. |
| Factories and building sites are coming back to life. But the big unknown is spending on services such as restaurants, bars and hotels - so-called "social spending". | Factories and building sites are coming back to life. But the big unknown is spending on services such as restaurants, bars and hotels - so-called "social spending". |
| Even with eating out vouchers and VAT cuts, a full and rapid recovery there seems unlikely. | Even with eating out vouchers and VAT cuts, a full and rapid recovery there seems unlikely. |
| And it is these sectors that have suffered most and have furloughed the vast majority of their staff. Their future will hinge on how spending convalesces there. | And it is these sectors that have suffered most and have furloughed the vast majority of their staff. Their future will hinge on how spending convalesces there. |
| High Street suffers | High Street suffers |
| Mr Athow said some sectors were "struggling". | Mr Athow said some sectors were "struggling". |
| "Some of that is due to the restrictions, which were only relaxed part-way through June in England. Clothing is down by about a third. | "Some of that is due to the restrictions, which were only relaxed part-way through June in England. Clothing is down by about a third. |
| "And if you look at the High Street more generally, sales in the High Street, or physical shops, are also down by about a third." | "And if you look at the High Street more generally, sales in the High Street, or physical shops, are also down by about a third." |
| Clothing sales did rise 70% month-on-month in June, but from a very low base, meaning that they are still well below pre-lockdown levels. | Clothing sales did rise 70% month-on-month in June, but from a very low base, meaning that they are still well below pre-lockdown levels. |
| Mr Athow said they had fallen so far that "virtually any pick-up will look like a big number". | Mr Athow said they had fallen so far that "virtually any pick-up will look like a big number". |
| The proportion of online spending reduced to 31.8% in June from the record 33.3% reported in May, but was well up on the 20% reported in February, said the ONS. | The proportion of online spending reduced to 31.8% in June from the record 33.3% reported in May, but was well up on the 20% reported in February, said the ONS. |
| Meanwhile, a survey measuring new orders, employment and business sentiment in the services and manufacturing sectors indicated a return to growth during June. | |
| The "flash" - or preliminary - Purchasing Managers' Index (PMI), compiled by IHS Markit and CIPS, rose to 57.1 in July, up sharply from 47.7 last month. | |
| It was the first time since February that it was above 50, indicating expansion. | |
| However, Markit's chief business economist, Chris Williamson, cautioned: "While the recession looks to have been brief, the scars are likely to be deep." | However, Markit's chief business economist, Chris Williamson, cautioned: "While the recession looks to have been brief, the scars are likely to be deep." |
| 'Online is how I have been able to survive' | 'Online is how I have been able to survive' |
| One businesswoman who has taken advantage of the move to online shopping is Hellen Stirling-Baker of Small Stuff, a Sheffield-based independent retailer. | One businesswoman who has taken advantage of the move to online shopping is Hellen Stirling-Baker of Small Stuff, a Sheffield-based independent retailer. |
| She sells sustainably made toys, gifts and homewares for young children. | She sells sustainably made toys, gifts and homewares for young children. |
| "Driving my store online is how I have been able to survive," she said. | "Driving my store online is how I have been able to survive," she said. |
| "Offering face-to-face video calling for customers to recreate the in-store experience has been crucial and sales are picking up. | "Offering face-to-face video calling for customers to recreate the in-store experience has been crucial and sales are picking up. |
| "I've also added new services such as local delivery by hand, which really boost engagement." | "I've also added new services such as local delivery by hand, which really boost engagement." |
| 'Hope on the horizon' | 'Hope on the horizon' |
| Jeremy Thomson-Cook, chief economist at Equals Money, said the retail sector had seen a "V-shaped recovery", echoing remarks by the Bank of England's chief economist, Andy Haldane. | Jeremy Thomson-Cook, chief economist at Equals Money, said the retail sector had seen a "V-shaped recovery", echoing remarks by the Bank of England's chief economist, Andy Haldane. |
| "The motto of the British consumer has long been 'When the going gets tough, the tough go shopping' and it seems like June encapsulated that well," he added. | "The motto of the British consumer has long been 'When the going gets tough, the tough go shopping' and it seems like June encapsulated that well," he added. |
| Silvia Rindone, retail partner at EY, said the latest figures showed there was "some hope on the horizon", with consumers beginning to show "a cautious optimism". | Silvia Rindone, retail partner at EY, said the latest figures showed there was "some hope on the horizon", with consumers beginning to show "a cautious optimism". |
| But she added: "We're still not past the pandemic and getting back to 'normal' will still take time. | But she added: "We're still not past the pandemic and getting back to 'normal' will still take time. |
| "With face coverings now compulsory in England's shops, physical retailers need to continue to focus on reassuring customers." | "With face coverings now compulsory in England's shops, physical retailers need to continue to focus on reassuring customers." |