Belfast Telegraph

Wednesday 16 April 2014

Freeze in wages and rising bills hit retail sector

Retail sales stalled this month as wage freezes and rising bills hurt household incomes, squeezing sales of clothes and shoes in particular, new figures showed.

Flat retail sales growth in March ended six months of rising volumes, according to figures from the CBI.

The data was weaker than expected for this time of year and heightened fears of a triple-dip recession.

"This month we've seen a glimmer of hope for retailers fade away, with the news that six months of sales growth has come to an end," said Barry Williams, Asda executive and chair of the CBI Distributive Trades Survey Panel.

"All eyes are now on April when retailers expect sales to return to form. However, pay freezes and the rising cost of living are hitting households hard and, added to a challenging economic picture, there may well be more tough trading conditions ahead."

IHS Global Insight economist Howard Archer said clothing and footwear sales may have been held back by the cold weather. The survey was completed before heavy snowfall blanketed the UK.

The business lobby group's survey of 118 firms, including 69 retailers, found a balance of 15% expect sales to be up in April.