Retail footfall is set to remain below 2019 for the foreseeable future as the cost of living crisis deepens and working from home becomes a permanent fixture, according to performance tracker Springboard, despite footfall strengthening in June to -12.3% below 2019's level (from -13.7% in May 2022).
This breaks down as a decline of -14.9% in high streets, -16.5% in shopping centres and -2.1% in retail parks.
The improved result was due to a rise in footfall of +8.6% during the Platinum Jubilee week in the first week of the month, which narrowed the gap from 2019 to just -4.9%. The gap from 2019 averaged -14% over the subsequent four weeks in June, reaching -16% across all retail destinations and -19.5% in high streets in the final week.
Robust store sales mitigated the overall impact on the retail sector, says Springboard, but sales were erratic from week to week – the first sign of consumers pulling back on spending.
Continued hybrid working continues to impact footfall in larger towns and cities (-21% below 2019 in Central London versus -9.9% in Outer London, and -15.8% in large city centres around the UK versus -15.2% in market towns).
Springboard anticipates that footfall will remain at least -10% to -15% below 2019 in the second half of 2022.
Springboard's marketing and insights director, Diane Wehrle, says: "Footfall strengthened for the third consecutive month in June, with the gap from 2019 narrowing to -12.3% from -13.7% in May. However, this improved result was wholly due to the positive impact of the Platinum Jubilee Bank Holiday in the first week of the month, when the rise in footfall of +8.6% from the week before narrowed the gap from 2019 to just -4.9%.
"Over the subsequent four weeks in June the gap from 2019 averaged -14%, worsening each week up until the final week of the month when the gap from 2019 reached -16% across all retail destinations and -19.5% in high streets.
"June’s result reinforces our view that the cost of living crisis is starting to impact consumer behaviour and constrain shopper activity. In the short term, the overall impact on the retail sector is being mitigated by robust store sales that continued in June overall, although sales performance was more erratic than in May with shifts from a positive to negative position occurring from week to week, the first sign that consumers are starting to pull back on spending.
"Whilst store sales are undoubtedly buoyed by spending from those middle-income families who had saved during Covid, we fully expect to see this spending slowing as people gear up for the increase in energy bills in October and for Christmas."
