The fact that confidence has remained more or less flat is encouraging in Q4 2019, as historically the Tracker has recorded a fall in confidence at this time of year. The clear result of the December UK General Election lifted some of the uncertainty that had been pervasive since the 2016 referendum and could have also boosted consumer confidence. Our survey, which took place during the first weekend of January 2020, indicates that over the last three months consumer confidence in the state of the UK economy strengthened from -55 per cent in Q3 2019 to -28 per cent in Q4 2019.
* Deloitte’s overall confidence index is the aggregate of six individual measures: levels of disposable income, levels of debt, job security, job opportunities and career progression, children’s education and welfare, and general health and wellbeing.
Consumers enter the new decade with significantly improved confidence not only in their personal finances and job security, but also in the state of the UK economy. However, consumer spending is expected to remain subdued compared to 2016 when household expenditure growth was at 3.8 per cent. It is forecast to run at a rate of 1.4 per cent in 2020, a third of the rate at the time of the referendum. While most UK economic fundamentals remain solid, including low inflation and the unemployment level close to a historic low, economists’ expectations of a slowdown in the employment rate and in real earnings growth could produce headwinds for consumers. However, if the reduced political uncertainty results in a strong rebound in corporate activity, such headwinds might not materialise.
- Deloitte Consumer Tracker Q3 2019 - The end of consumers’ resilience?
- Deloitte Consumer Tracker Q2 2019 - Signs of a consumer slowdown
- Deloitte Consumer Tracker Q1 2019 - Keep calm and carry on
- Deloitte Consumer Tracker Q4 2018 - A worried nation
- Deloitte Consumer Tracker Q3 2018 - Loss of momentum
- Deloitte UK Leisure Consumer Q2 2019
- Experience is everything: The UK leisure consumer