Spend oddity

Now here’s something none of us were expecting. Retail spending went up in May, says Reuters. This is peculiar because everyone’s talking about an economic slowdown. And they didn’t just nudge up a bit, they shot up by 3.5 per cent.

This is strange because we’re all feeling the pinch quite a bit – I know, I filled my car the other day. So what’s fuelling the sales mini-boom? Reuters’ contacts believe it’s seasonal. I have a few further ideas:

1. Let’s play a game. Go onto a train or bus and see how many people under 20 are carrying very visible consumer electronics, usually a media player of some sort. They keep buying this stuff regardless of what happens to the economy.

2. The nation is notoriously a binge-drinking group of massively obese individuals. We are not achieving this by holding back on food and drink spending.

3. As a side effect of 2, even those of us who don’t feel obliged to buy a new summer wardrobe every year are finding to our dismay that none of last season’s clothes actually fit any more. So we’re going out and replacing them.

Add inflation and the real price rises rather than official figures (see the car comment above) and you’ve got a good basis for quite a nice little rise in spending, at least in the shorter term.

Guy Clapperton is a freelance journalist who specialises in small business issues and has written for the likes of The Guardian, the FT and the Daily Mirror. Guy has written about finance and franchising for SmallBizPod. http://www.guyclapperton.co.uk