Consumer confidence hits record low

Monday 11th May 2009

Consumer confidence in Britain has fallen to its lowest ever level, it has been announced.

The consumer confidence index from the British Retail Consortium (BRC) fell from 74 points in October to 65 in the latest survey – the lowest figure since recording began in 2004.

This time last year the index stood at 79 and peaked at 101 in spring 2006.

The BRC claims the fall in confidence is directly linked driven by mounting uncertainty about jobs in the coming year.

Of those polled, 86 per cent said they felt 'negativity' about their job prospects over the next 12 months.

And 42 per cent said they felt job prospects were 'bad' for the coming year, a significant rise from the 23 per cent level last October.

In terms of personal finances, almost 50 per cent of people said they thought their own situation would 'not be good' in the coming months.

While 47 per cent of people said they thought now was not a good time to spend money on things they wanted and needed.

And only 13 per cent of people also said they thought Britain would come out of the current recession in the next 12 months.

Commenting on the figures, Stephen Robertson, British Retail Consortium director general, said: "This survey suggests the economy’s climb back to growth will be harder and slower than the government claims.

"Only 13 per cent of people believe we'll be out of the recession by this time next year. Six months ago nearly one in five thought the recession would be over by this Christmas. Clearly most people don’t share the chancellor's optimism.

"The decline in worries about food, utility and fuel prices would be unambiguously good news - if it hadn't been replaced by concerns about jobs.

"Customers and retailers will go on suffering for a good while yet. It's business that will get us out of recession and retail is a key driver of growth. That means every time a minister thinks up a new idea that will impose regulations and costs, they must ask themselves – is this extra handicap really necessary now?"

People cited job security as their biggest concern (20 per cent, up from four per cent in October), followed by the economy (19 per cent) and debt (13 per cent).

Saving was the top answer for what people do with their disposable income, followed by spending on holidays. However, fewer people said they spend on these and all the other options than recorded previously.

Justin Sargent, managing director Nielsen, UK added: "Many people have now had some sort of first hand experience of job losses, either within their own workplace or through friends or family members losing jobs, so it is little wonder that almost nine out of ten people think that job prospects look grim for the coming year.

"With such concerns, and little hope of pay increases for many of those in employment, we would expect confidence in personal finances and the impetus to spend to suffer as well."

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