Belfast Telegraph

Latest woes another sign of tough times for retail sector

By Angela McGowan

The UK retail data for May saw a miniscule rise of 0.2% relative to the same period last year.

Although there is no official data for Northern Ireland's retail sector, anecdotal evidence suggests that a pattern of weak retail sales locally is reflecting that national trend.

Households right across the UK have faced rising prices because of the oil price shock in Quarter 1, combined with a rise in VAT - while simultaneously wages have remained static.

The Office of National Statistics reported this week that real household disposable income fell by 0.8% in the first quarter.

Despite the fact that some households are benefiting from lower mortgage payments, many households do not have a mortgage or mortgage relief - and the retail sector will feel the impact of that disposable income drop. The Northern Bank's local sectoral forecast report has estimated the local retail sector will grow by a mere 0.9% this year - so things will be tough.

Whether or not the negative signal emerging around closures from stores such as TJ Hughes and Thornton's will send a signal to the Government to reconsider their VAT hike remains to be seen, but in the interim the high street is bracing itself for a year of relatively low sales caused by cautious consumers and continued shift towards online shopping.

Popular

From Belfast Telegraph