Something to Smile About: The retail sector

“Doesn’t really tally…”

“Hard to explain…”

What has got some of the UK’s economists so flummoxed? Well, this morning the Office for National Statistics announced that contrary to all expectations, total sales volumes actually climbed 0.3% in November from the previous month. That’s up 1.5% from the same period last year, when Britain was at the heady heights of its consumerism and boom behaviour.

The results were a million miles away (or at least just under one percent away) from predictions of a 0.6% drop in sales for November, thanks in part to high profile price cuts and promotions combined with the recent falls in interest rates and VAT. The biggest risers were household goods, up 3.9%, and online retail up 3.8%, while food rose 0.1% as the sprint up to Christmas kicked off.

So what does all this mean? Well, according to British Retail Consortium director general Stephen Robertson, it means that “retailers will now dare to breathe a sigh of relief that customers are simply deferring their Christmas spending rather than cancelling it entirely.” For the rest of us whose businesses and jobs rely on liquidity in the British retail market, it is a sign that things perhaps aren’t as bleak as they seem - or, if nothing else, as bleak as the media likes to portay them. Personally, I think it represents a glimmer of hope just two weeks before the doors of one of the country’s retail icons, Woolworths, close forever. My sympathy goes out to the 27,000 people affected by the closure of a great British brand. But with that sympathy comes a new sense of resolution. Things are getting pretty bad, and things are getting pretty personal - I have friends whose family worked at Woolworths and whose childhoods were spent there. Friends who were in tears after the news. Yet I am convinced that those people and the retail sector as a whole will come through this (admittedly significant) blip stronger than ever. And November’s results are just the start.

Read more here

• Surprise rise in UK retail sales
• 27,000 axed at Woolworths on dark day for High Street
• Retail sales: what the economists say