Consumer spending grows but West Midlands lags behind most of UK

A ‘TRIPLE WHAMMY’ of warmer weather, a late Easter and a long bank holiday weekend helped boost consumer spending in April to its highest level since last summer.

However, while confidence levels around the UK are high, the West Midlands is lagging behind all other regions except Yorkshire and The Humber when it comes to spending levels.

Barclaycard said strong growth was seen in supermarket spending, on clothing and at department stores as households stocked up on food and drink for Easter, updated their wardrobes for spring, and took the opportunity of four days off to go shopping.

Clothing spend grew 13.8%, supermarket spending was up 8.9% and department stores saw a 4.1% increase.

However, huge growth in spending at ‘discount retailers’ continued and Barclaycard said a further fall in average transaction values indicated that consumers were yet to see the improving state of the economy impact on their own finances.

Across the UK, spending rose by an average of 3.7% between April 2013 and last month. London topped the list of biggest spenders – up 4.4%. Belying its high employment status and weak industrial base, the North East saw the second biggest growth – up 4.3%, a figure matched by the East of England.

In contrast, the West Midlands saw growth of just 3.2% – a figure matched by Scotland and Northern Ireland. Bottom of the list of spending areas was Yorkshire and The Humber, with growth of just 2.6%.

Barclaycard, which processes nearly half of all the UK’s debit and credit card transactions, said spending at ‘discount retailers’ was up 30% in the year to the end of April and average transaction values were down a further 5% in the same period, as pressure on household finances forced consumers to trade down.

The increased spending on clothing, in supermarkets and at department stores helped push up in-store spending by 3.1%.  Spending on family clothing – up 21.3%; restaurant spending – up 16.8%; and cinema spending – up 7% as a series of blockbuster movies were released to coincide with the Easter holidays, all helped in-store spend see its best performance since last summer.

With more consumers hitting the high street, online spending suffered slightly in April and though it saw growth of 5.8%, this was down from 6.4% in March and the lowest level seen this year.

However certain categories did see growth. Spending on men’s, women’s and family clothing was up 66%, 41% and 23%, respectively, year-over-year. Online DIY spend grew 44% and online garden centres grew 40%.

Spending on petrol continued to fall and was down 5.8%, despite the end of the school term and Easter holidays.

The booming housing market has been linked to the increased spending in DIY stores and garden centres – continuing the trend of the past year – as consumers opt to invest in home improvement. Spending in DIY stores was up 11.9%, whereas garden centre spending grew 20.2%.