Consumers that voted ‘Remain’ in the UK’s Brexit referendum are likely to be more pessimistic about their spending habits than those that voted ‘Leave’, a new study has found.
With the Brexit impasse showing little sign of subsiding, the study by Retail Economics found that 30% of ‘remain’ voters claim Brexit is the greatest source of concern affecting their confidence to spend, compared to just 6% of ‘leave’ voters.
‘Not Important’
“Indeed, 86% of leavers suggested that Brexit was “not important at all” in their confidence to spend, more than twice the proportion of remainers (39%),” Richard Lim, chief executive of Retail Economics, reported.
This polarisation also relates to how cautious shoppers are when it comes to discretionary spending.
Almost two thirds (63%) of remainers said that they are likely to be more cautious with their discretionary spending in the final three months of the year, compared with a quarter of leavers, the research body said.
“This may in part explain why some parts of the market (John Lewis, Ted Baker, Karen Millen) have come under increasing pressure,” Lim explained. “Of course, there are many moving parts in retail and this will be another cog (maybe just a small one).
“But in an industry that is increasingly run on wafer-thin margins, it's marginal differences that can create a big impact on the bottom line."
Main Concerns
When asked about their chief concerns on 31 October in the event of a no-deal Brexit, 58.4% of leave voters said they had 'no concerns at all', compared to 10.5% of remain voters. The 'rising cost of living' was a concern for 26.6% of remain voters, and 11.0% of leave voters, while a 'weaker economy' was a concern of 16.6% of remain voters and 12.6% of leave voters.
Interestingly, the 'availability of essentials' was a key concern for close to a fifth of remain voters (18.7%), compared to just 7.5% of leave voters.
When asked about their spending plans for this Christmas, in the event of a no-deal Brexit, 44.2% of respondents said that they expected to spend 'about the same', compared to 69.6% of leave voters.
Retail Sales Monitor
Commenting on the recent BRC-KPMG Retail Sales Monitor figures, which show that Brexit fears are holding back spending, Lim added, "Despite vast improvements in spending power, these figures suggest that Brexit fears are damaging confidence, particularly for buying non-essential items.”
The findings were derived from a nationally representative sample of more than 2,000 households across the UK, in September, segmented by those that had voted to remain in the Brexit referendum, and those that had voted to leave.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
