Retail sales growth has slowed to half that achieved before the collapse of Lehman Brothers which signalled the start of the recession in 2008.
Figure’s released by the British Retail Consortium to mark the fourth anniversary of the bank’s failure showed year-on-year growth in the total value of retail sales averaged just 2.1% over the last two years.
That is below inflation, meaning sales volumes have stagnated, and compares with much stronger growth of 4.5% over an equivalent period before the crisis.
As the political party conference season begins, and on the day Business Secretary Vince Cable is expected to address Liberal Democrats, the BRC has called on the Government to restore consumer confidence by controlling the costs it imposes on households.
The trade body wants Government to scrap the postponed fuel duty increase, scheduled for January, and limit costs on retailers including business rates, which it believes should be frozen in 2013.
UK economic output remains 4% below its pre-recession peak and the continued weak economic situation has ensured that consumer confidence remains close to the record lows of 2008.
The squeeze on real disposable incomes has persisted for almost three years and the impact on spending on essential items has intensified, recently, the BRC said.
British Retail Consortium director general Stephen Robertson said: “Four years on from this key event in the banking crisis, which sent retail sales plummeting, sales growth is still less than half what it was before. Sales volumes are now going backwards.
“Representing over 5% of GDP and more than 10% of jobs, retail is a vital part of the UK economy and a key indicator of its health. Retail is fundamentally resilient. It’s still the biggest private sector employer in the country but this analysis vividly demonstrates the lasting blow dealt to households and to retail sales by the crisis of 2008.
He added: “Scrapping the postponed fuel duty rise, now due in January, and freezing business rates next year are top of my list.”