Households’ confidence over their financial situation for the year ahead has edged up, but fears of mass unemployment are fuelling wider consumer concerns, according to a report.
The latest GfK consumer confidence index found Britons have become slightly more optimistic about their personal financial situation for the next 12 months, with the score in positive territory – at plus one point – for the first time since the crisis struck in March.
But they remained gloomy over the general economy situation over the next 12 months, with the score on this measure firmly stuck in negative territory at minus 42, against minus 41 last month.
Employment is now the big issue because the pandemic has ended years of job securityJoe Staton, GfK client strategy director
Consumers’ attitudes towards making major purchases improved slightly, but was also remained negative, in a worrying sign ahead of the crucial sales season for retailers.
When asked, in view of the general economic situation, if they think now is the right time to make major purchases such as furniture or electrical goods, the score on this measure was minus 25, against minus 26 previously.
The report – which surveyed some 2,000 people – found the overall consumer confidence index score remained unchanged at minus 27 for August.
Joe Staton, GfK’s client strategy director, cautioned the one point uptick in confidence over personal financial situation “does not amount to much” and could easily swing the other way when the Government’s furlough scheme ends in October.
He said: “Employment is now the big issue because the pandemic has ended years of job security.
“Yes, discounted dinners have proved a winner with hungry consumers across the country this month, but it’s difficult to see any increased appetite for other types of spending for now.
“While our Major Purchase Index managed to increase by one point in August, the economic headwinds are not favourable as we enter the key retailing months at the end of the year.”