Consumer confidence in Scotland lowest in over a year

Consumer confidence levels in Scotland have dropped to the lowest it has been in over a year, and below the UK-wide average, new research indicates.

According to the latest Deloitte Consumer Tracker, Scotland’s consumer confidence results have dropped to a net balance of  -9%, which is lower than the UK average of -7%.

Scotland’s result has dropped a whole four percentage points since the last quarter. This is the lowest it has been since the second quarter of 2017.

Some local business owners in Bruntsfield, Edinburgh responded to the research, and were surprisingly optimistic about their customers, despite the recent findings.

Gavin Elden, A La Carte owner, said: “Even when times are tough, people just want to have treats, so we haven’t noticed too much of a change.

A La Carte on Bruntsfield Place. Credits to Daisy Smith

“However, there has been a huge change around here, and lots and lots of shops have changed hands.

“It is hard to tell with Brexit. I think the whole country is just uncertain at the moment about everything. It could be fantastic or it could be a disaster.”

Clementine Home and Gifts worker, Monica, said: “I would definitely think Brexit will have an effect. Everyone is talking about it and I will probably be affected because I am from Poland.

Clementine on Bruntsfield Place. Credits to Daisy Smith

“My friends are all concerned and it definitely has an impact on how people view their future here and spending as well because people are saving instead of spending just in case.”

Cat Anderson, Edinburgh Bookshop worker, said: “I was talking to the boss the other day and she is really impressed with how much people are shopping and she puts it down to Brexit.

The Edinburgh Bookshop on Bruntsfield Place. Credits to Daisy Smith

“People are just like we don’t care anymore, we are going to live regardless, we don’t know what is coming next so we might as well just enjoy ourselves.

“I have certainly seen a massive increase in food prices and have changed my shopping habits accordingly. Brexit is definitely having an impact.”

In Scotland, five out of the six measures of confidence dropped compared to the last quarter. The measure which grew in confidence was regarding job opportunities and career progression which rose by four percentage points to -4%.

The main reason for the downfall in consumer confidence was plunging levels of optimism regarding general health and wellbeing. This category dropped 18 percentage points down to -16% since the previous quarter. This was closely followed by a steep drop in levels of confidence around household disposable income which fell to -24%.

Levels of confidence fell in all six categories for the UK-wide results. The sharpest decline was in the category regarding disposable income and personal debt.

Deloitte chief economist Ian Stewart, related the downfall to Brexit and said: “The reality of higher inflation and August’s interest rate rise has dented optimism about spending power.

“Meanwhile uncertainty and the manner in which the UK exits the EU in less than six months’ time is creating an additional headwind for consumers.

He added: “That such consumer-friendly conditions have failed to boost confidence testifies to the headwinds from inflation, interest rate rises and Brexit.”

 The survey was carried out between September 21 and 29 and involved 3105 consumers across the UK, with 371 being in Scotland.

 

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