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Grow's Monthly Retail Sales Report - February 22

Main Points


Retail sales volumes fell by 0.3% in February 2022 following a rise of 1.9% (unrevised) in January 2022; sales volumes were 3.7% above their pre-coronavirus (COVID-19) February 2020 levels.


Non-store retailing sales volumes fell by 4.8% over the month following strong growth in December (2.7%) and January (4.0%); sales volumes were 33.2% above their pre-coronavirus February 2020 levels.


Food store sales volumes fell by 0.2% in February 2022 with large falls in alcohol and tobacco stores, which may be linked to higher spending in pubs and restaurants as confidence increased in going out; food store sales volumes were 0.1% below pre-coronavirus February 2020 levels.


Non-food stores sales volumes rose by 0.6% in February 2022 with growth in clothing (13.2%) and department stores (1.3%), with wider socialising and the return to the office following the lifting of Plan B restrictions at the end of January potential factors; these increases were partly offset by falls in other non-food stores (negative 7.0%) and household goods stores (negative 2.5%) with some retailers suggesting the stormy weather during the month had impacted footfall.


Automotive fuel sales volumes rose by 3.6% in February 2022 as the lifting of Plan B restrictions in England at the end of January 2022 increased travel; sales volumes were above pre-coronavirus February 2022 levels (0.9%) for the first time.


The proportion of retail sales online fell to 27.8% in February 2022, its lowest proportion since March 2020 (22.7%), continuing a broad downward trend since its peak in February 2021 (37.7%).


Retail sales in February


Retail sales volumes fell by 0.3% in February 2022, following an unrevised rise of 1.9% in January 2022. Retail sales values, unadjusted for price changes, rose by 0.7% in February 2022, following a rise of 1.7% in January. When compared with February 2020's pre-coronavirus (COVID-19) level, total retail sales were 3.7% and 10.2% higher in volume and value terms respectively.

Compared with the same period a year earlier, sales volumes over the last three months rose by 4.4% while sales values rose by 11.7% reflecting an annual implied deflator (or implied growth in prices) of 7.2%. Percentage change over the past year should be interpreted with caution given the impact of coronavirus restrictions and base effects on growth rates. In February 2021 there were restrictions on non-essential retail in England, Scotland, and Wales.


Retail sales volumes fell in February 2022 following growth in January 2022


Retail sales volumes fell by 0.3% in February 2022 but were 3.7% above their levels in February 2020.

Non-store retailing sales volumes fell by 4.8% over the month. Despite this fall, sales volumes were 33.2% above their pre-coronavirus February 2020 levels. To note, all other retail sectors, not classified as “Non-store retailing”, have a physical presence but may also trade online.


Food store sales volumes fell by 0.2% over the month and were 0.1% below their February 2020 levels. Supermarkets reported an increase of 0.3% over the month but that was offset by falls in specialist food stores (such as butchers and bakers) of 2.0% and alcohol and tobacco stores which fell by 16.1%.


Automotive fuel sales volumes rose by 3.6% in February 2021 as more people travelled following the lifting of Plan B restrictions in England at the end of January. In February 2022, fuel sales volumes were (0.9%) above their pre-coronavirus February 2020 levels for the first time.


Non-food stores sales volumes rose by 0.6% with strong growth in clothing stores (13.2%) and department stores (1.3%), which may be linked to wider socialising and the return to the office following the lifting of Plan B restrictions. The sub-sectors other non-food stores and household goods stores fell by 7.0% and 2.5% over the month with feedback from some retailers suggesting the stormy weather between 16 and 21 February had affected footfall.


Month-on-month contribution to growth by sector


Retail sales in February 2022 were impacted by falling sales in non-store retailing

Chart above shows the contributions to the 0.3% month-on-month fall in overall retail sales volumes (quantity bought) in February 2022. This highlights that non-store retailing had the largest contributions to the fall over the month.


Retail sales, selected sectors


Non-store retailing - Non-store retailing sales volumes fell back in February 2022 following increases in recent months

Non-store retailing sales volume levels rose sharply during the early months of the coronavirus (COVID-19) pandemic as many online stores continued to trade when non-essential retailing was closed. The level of sales have remained relatively high over the last couple of years, but as restrictions have loosened, levels have fallen back. In February 2022, sales volumes fell by 4.8% following increases of 4.0% January 2022 and 2.7% in December 2021, when strong on-line sales may have been linked to consumer concerns about the Omicron variant during those months. Despite this fall, sales volumes were 33.2% above their pre-coronavirus February 2020 levels.


Some of the fall in February may also be because of affordability concerns. Results from the Opinion and Lifestyle Survey (OPN) covering the period 16 to 27 February found that of the actions taken because of an increase in the cost of living, 51% of adults reported spending less on non-essentials.


Food Stores


Food store sales volumes below pre-coronavirus pandemic levels

Food store sales volumes fell by 0.2% over the month to February 2022 and were 0.1% below their February 2020 levels. The fall over the month was led by a 16.1% fall in sales in alcohol and tobacco stores which may be because of wider spending in pubs and restaurants as confidence returned in going out. Data on UK spending on debit and credit cards based on CHAPS payments made by credit and debit card payment processors, reported a pick up in its "social" spending category (such as restaurants and pubs) between January and February 2022.


Sales volumes have broadly fallen since June 2021 as consumers diverted spending to services as the wider economy reopened. The Bank of England's Agents' summary of business conditions for 2022 Quarter 1 (Jan to Mar) noted that contacts in the hospitality, entertainment and leisure sectors reported a rapid pickup in demand in recent weeks as concerns about the Omicron variant dissipated.


Affordability may also explain some of the fall in recent months. Results from OPN covering the period 16 to 27 February found that 81% of adults reported that their cost of living had increased over the last month. This was 12 percentage points higher than the 69% in the period 19 to 20 January 2022 with the most frequent reported reason being rising food shop prices (92%). Of the actions taken because of an increase in the cost of living, 30% reported spending less on food shopping and essentials.


Automotive fuel


Automotive fuel sales volumes were above February 2020 levels for the first time

Automotive fuel sales volumes rose by 3.6% in February 2022 following an increase of 3.9% in January 2022. Plan B restrictions which included asking people to work from home if they could were lifted in England at the end of January 2022.


The Opinions and Lifestyle Survey covering the period 16 February to 27 February 2022 reported that the percentage of working adults working from home was 15%, continuing a decline since 6 to 16 January 2022 (26%).


This is also supported by the Business insights and impact on the UK economy release where businesses reported that during the period 7 February to 20 February 2022 the majority of their workforce (62%) were estimated to be working from a designated workplace, that is, not from home. This is up from 57% during the period 13 December to 26 December.


Online retail


Summary of internet statistics

Chart shows the month-on-month and month-on-year (annual) growth rates for the amount spent online by value and the proportion of total retail sales value that was made online by sector. The percentage weights indicate where money is spent online. For example, 7.6 pence in every pound spent online was spent in department stores in 2021.


Online spending values fell in February 2022 by 0.7% when compared with January 2022, with falls in all sub-sectors apart from clothing stores which increased by 0.7%.


The proportion of online sales fell to 27.8% from 28.1% in January 2022. This is a continuation of a broad falling trend since its peak in February 2021 (37.7%). Despite the ongoing trend, the proportion of sales made online is still above its level of 20.0% in February 2020 before the coronavirus (COVID-19) pandemic.


Note that methods used to estimate online sales have been improved this month, resulting in higher estimates of percentage of retail conducted online than reported previously. The trend of an ongoing reduction of online sales from a peak in early 2021 is unaltered.


Source ONS

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