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UK consumers brace themselves for price hikes
83 per cent of Brits fear the cost of goods and services, including clothing, is set to rise.

By Isabella Griffiths

19 May 2017

Latest research by market analyst Mintel reports that UK consumers are bracing themselves for an expensive future ahead. Over four in five (83 per cent) Brits are currently concerned about seeing price rises on goods and services, with 59 per cent worried about the mounting cost of groceries, 35 per cent worried about the climbing cost of holidays and 26 per cent fearing that clothes prices will ascend.
 
According to the findings, Brits are also worried about “bigger picture” issues. As many as 81 per cent of UK consumers are concerned about the future health of the NHS, while 68 per cent are worried about the UK economy and 67 per cent are nervous about the state of the environment. By contrast, people appear less concerned by issues relating to their personal situation, with half (48 per cent) of all adults concerned about their ability to pay the bills and less than two in five (37 per cent) worried about their level of debt.
 
Today, 46 per cent of UK consumers say that Britain's vote to leave the European Union will have a negative impact on the cost of living in the UK, with this proportion unchanged from when the question was first asked in July 2016, immediately following the referendum result. However, attitudes towards Brexit’s impact on the economy appear to have softened, as 31 per cent now believe it will have a negative impact on the UK’s economic growth, down from 39 per cent in July 2016.
 
“Following the UK’s vote to leave the EU, there has been a great deal of discussion about how it will impact the price of goods and services. Mintel research underlines particular concern about the rising cost of in-home food, and inflation is undoubtedly going to squeeze household budgets. However, broader consumer confidence is still relatively strong. Despite rising prices, most people still expect their finances to hold up well over the next year. It's the bigger picture issues that the UK faces, such as the NHS and the economy, that are the main concern, rather than people’s own finances,” say   Jack Duckett, senior consumer lifestyles analyst at Mintel. 
 
Despite the political turbulence, Mintel research found that consumer expenditure rose by 3.7 per cent in 2016 to reach £1.2 trillion. While growth was seen in nearly all of the 17 individual sectors included in Mintel’s British Lifestyles report, it was notably lower across all fast-moving consumer goods markets, reflecting ongoing supermarket price wars.
 
By 2021, it is projected that Britons will spend £1.4 trillion per annum, with growth of 17 per cent expected over the next five years. Mintel predicts that the foodservice, personal finance, and leisure and entertainment categories will flourish in this time, while the household care, technology and clothing and accessories markets are expected to face challenges.
 
Sales of clothing, footwear and accessories are predicted to rise by just 1.9 per cent in 2017. While the fashion market has flourished in recent years, growing by 5.6 per cent in 2015, Brits are increasingly prioritising spending on leisure activities and experiences over material possessions, in what has become known as “the experience economy”. Indeed, the leisure and entertainment market grew by an estimated 3.2 per cent in 2016, outpacing the 2.4 per cent growth estimated for the clothing, footwear and accessories category.
 
Currently it’s menswear which is bagging growth, with sales rising by 2.8 per cent in 2016. Just one in five men (20 per cent) said they spent less on clothing and accessories over the past year, compared to 26 per cent of women.


 
 
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