Consumer confidence has slumped close to levels seen during the first national lockdown in April, as shoppers feel “on edge” ahead of the festive season.
The latest Consumer Confidence Barometer from GfK (carried out between 2 – 13 November) reveals overall consumer confidence has fallen to a score of -33, just shy of the lows seen in April (-34) and May (-34) this year.
Gloom set in as England entered its second national lockdown on 5 November and restrictions tightened elsewhere across the UK, with overall consumer confidence falling two points from October. Back in November 2019, consumer confidence stood at -14.
This month’s headline score of -33 is only six points above the lowest-ever number of -39, seen in July 2008 ahead of the recession caused by the global financial crisis. However the context is different to 2008, insists GfK client strategy director, Joe Staton.
“With the likelihood of more good news on Covid-19 vaccines and eventual implementation, marketers can expect better consumer confidence numbers in due course,” he states.
That being said, the index measuring changes in personal finances over the past year declined sharply in November to -16, down seven points on October. The savings index recorded a three-point drop to 11, compared to last month.
The personal finances forecast for the next 12 months fell from a score of zero in October to -5 in November, as confidence took a hit amid continued uncertainty over Christmas restrictions and the closure of non-essential retail in England.
When it comes to the wider economy, consumer confidence remains stubbornly low. There is no change from the gloomy tone set in October, with the index measuring the general economic situation sticking at -67. In November 2019, this figure stood at -34.
Likewise, looking ahead to the next 12 months, consumer confidence about the general economy remains at -50, down 16 points compared to November last year.
“Consumers appear to be on edge in the critically important month before Christmas and these growing worries will hardly lift the festive mood. Look at the big falls in how consumers see their personal finances – that’s what is pushing the overall confidence score lower,” says Staton.
“We all know it’s going to take some time too before the local or national lockdowns become history. But that’s what we need to see before we can celebrate robust consumer confidence figures again.”