December retail sales rise but volumes fall as cost of living hits consumers

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Retail sales rose by value in December 2022 but volume was down, official data has shown.

Retail sales excluding fuel rose 3.3% year on year by value over the month, the Office for National Statistics reported. However, volume was down 6.1%.

Month on month there were declines of 1% and 1.1% respectively.

The ONS reported that non-food store volumes fell by 2.1% over the month, “with continued feedback from retailers and other wider evidence that consumers are cutting back on spending because of increased prices and affordability concerns”.

Food store volumes fell by 0.3% in December and there was feedback from retailers “suggesting that customers stocked up early for Christmas”.

PwC industry lead for consumer markets Lisa Hooker said: “While not as large a decline as we saw in November’s figures, the headline 1% decline in retail sales volumes for December comes in stark contrast to the generally better-than-expected trading results announced by retailers earlier this month.

“In fact, while sales volumes have fallen by 6% compared with December 2021, pounds in the till increased. This underlines the fact that even accounting for the slight easing of inflation reported earlier this week, shoppers are simply spending more to get less for their money.”

The ONS said the proportion of online sales fell to 25.4% in December from 25.9% in November, ”with anecdotal evidence that Royal Mail strikes led to consumers shopping in stores more”.

The ONS also observed: “Between 2021 and 2022, retail sales volumes fell by 3%, as the lifting of restrictions on hospitality led to a return to eating out and rising prices and the cost of living affected sales volumes.”