UK consumer sentiment improves despite lockdown

UK consumer confidence improved in April despite the Covid-19 lockdown that has shut much of the UK economy, a survey showed.

PwC's monthly consumer sentiment survey showed household perceptions improving after the biggest fall in the poll's history recorded in March.

The score for April was -14, up from -26 in March though still in negative territory. April's survey was conducted over the sunny Easter weekend whereas the March survey was conducted just after the government announced its first lockdown measures for pubs and restaurants.

By the time the April survey was carried out the government had closed all but essential shops but it had also announced several relief programmes to support businesses and households.

Sentiment improved among all age groups and regions with under-25s showing the strongest increase of +38 points. PwC said with this age group most likely to be in low-paid, unsecure jobs their morale may have been boosted by the rollout of the government's job retention programme, which subsidises wages.

Under-25s were also the only age group that expected to be better rather than worse off in 12 months. Other age groups were gloomy about the future but middle-aged respondents were more so, perhaps because they envisage a tougher run-up to retirement than before, PwC said.

Lisa Hooker, PwC's consumer markets leader, said: "

“It’s too early to say for certain, but the improvement in consumer sentiment could point to light at the end of the tunnel, as other countries begin to come out of their lockdowns and there is more certainty around the government relief schemes. This also suggests that we may see an upswing in consumer spending once the lockdown is lifted and operators are able to reopen."

The survey also found spending patterns changing during the crisis. Almost a fifth of consumers reported buying more from small companies with 8% buying from brands they believed were looking after workers. Among the young the figures were higher at 28% and 17% respectively.

Almost a quarter of respondents said they intended to favour smaller and more benevolent brands in future. One in six said they bought more from local high streets. Respondents aged 45-54 were most likely to do so with a score of 21%.

PwC's Hooker said: “In these difficult times we are seeing signs that consumers are engaging with retailers differently and rewarding operators they perceive as more responsible. Consumers tell us that they will be doing more of this."