Official data show that retail sales declined sharply last month as consumers reined in spending ahead of Rachel Reeves’s Budget announcement.
The Office for National Statistics (ONS) reported a 0.7% drop in sales volumes for October compared to the previous month. This follows a revised September increase of 0.1%, down from an earlier estimate of 0.3% growth.
The October decline was also worse than analysts’ predictions of a 0.3% fall.
ONS senior statistician Hannah Finselbach noted: “The decline was largely due to a particularly weak performance in clothing stores, but retailers across the board reported that consumers were holding back spending in anticipation of the Budget.”
The slump comes amid growing backlash from Britain’s largest retailers over the Chancellor’s proposed National Insurance hike.
Retail giants including Tesco, M&S, Boots, and B&Q warned in a letter to Ms. Reeves that the increased costs would lead to inevitable job losses and store closures.
The letter, signed by over 70 companies, highlighted that the retail sector faces an additional £7 billion in costs due to changes in employers’ National Insurance contributions, a higher minimum wage, and new packaging levies.
These burdens, they argue, will significantly strain businesses and threaten their ability to operate effectively.
