January retail sales show recovery after easing of Covid-19 measures

The latest Office of National Statistics (ONS) data on UK retail sales has found 11.6% year-on-year growth in sales in January 2022 when work-from-home guidance and face covering rules were relaxed.

Non-food sales volumes rose 3.4% in January 2022, with strong growth in household goods, furniture and electricals, and in department store sales, both up by more than 7%.

Only food stores saw a decline in sales volume, possibly indicative of consumers returning to restaurants: non-food sales were 1.1% below pre-pandemic levels of February 2020 when Covid-19 guidance restricted the trading of cafés and restaurants.

Online sales also saw a decline in January to the lowest proportion of since March 2020 as customers returned to shopping in physical stores. Despite this downward trend since peaking at over a third of sales in February 2021, online shopping remains above pre-pandemic levels and represented just over a quarter (25.3%) of sales in January 2022.

Helen Dickinson, Chief Executive of the British Retail Consortium, welcomed the good performance of retailers in January. Commenting the figures revealed this week by the ONS, she said:

“Despite falling consumer confidence, retail sales held up well in January as retailers went to great lengths to keep up the Christmas momentum. Sales of non-food items, including clothing, furniture and household goods all grew by high double digits. Meanwhile, food sales dropped – though this is compared to January 2021, when most of the country was in lockdown and households were unable to eat out.  

“Falling Covid cases and the slow return to offices offer further hope for town and city centres that were hardest hit by the pandemic. Yet, rising inflation means households may be preparing for future falls in disposable income, including from April’s National Insurance and energy price cap rises. Retailers face similar challenges, with increases in transport and energy costs, global commodity prices and domestic wages. While retailers are going to great lengths to mitigate or absorb these cost increases, it is inevitable that prices will rise further in the future.”