Retail sales picked up in the year to November following a significant dip in October, according to the latest CBI Quarterly Distributive Trades Survey.
The survey of 128 respondents has however, seen the strongest growth in average selling prices in over 26 years in the year to November. Similar price growth is expected next month. Orders placed with suppliers rose at a solid rate over the year and are set to grow at a similar pace next month. Looking at individual sectors, grocers and clothing retailers reported robust sales.
But tepid trading conditions for the retail sector are taking their toll on hiring and optimism. The quarterly survey showed that employment declined in the year to November, for the fourth quarter running, and is set to fall again in the year to December. Retailers once again expect the business situation to deteriorate – albeit marginally – over the next quarter, but investment spending is expected to grow slightly in the year ahead for the second consecutive quarter.
Rain Newton-Smith, CBI Chief Economist, said:
“It’s great to see retail sales rebound this month after a big dip, but let’s be clear: our high streets are not out of the woods. Ahead of the crucial run up to Christmas, the weaker pound has pushed up prices and retailers are nervous about business conditions and are trimming their workforces.
“The relief from the rising burden of business rates in Chancellor’s Budget will be welcome on the UK’s high streets, as will the investment in local transport connections and housing which should supporting our local communities but the job is not done, now is the time for swift delivery.”