New research from the Visa Consumer Spending Index shows that consumer spending rose 2.5% in October, compared to the year before.
This rise in consumer spending has been led by hotels, restaurants and bars which have seen an increase of 9% and recreation and culture, growing 7.4%.
This will come as welcome news to operators in the bar, pub and restaurant sector worried that Brexit will lead to people spending less as consumer confidence is dented.
Kevin Jenkins, UK and Ireland managing director at Visa said the half term break and Halloween may have helped. “Consumer spending growth rose to a six-month high in October,” Kevin said. “Talk of potential price rises does not appear to have dented consumers’ confidence, with spending up 2.5% on the year, on a par with pre-referendum levels.
“The experience economy continued to fuel this growth. Hospitality and leisure were the best-performing sectors once again, boosted perhaps by the half term break and Halloween, with a noticeable increase in spend on food and drink.
Josh Beer, business development manager at the Illustrious Pub Company in Cambridgeshire said despite the news, he would still be taking a cautious view.
“October tends to be a good month for us as people settle back into their routine following holidays and the launch of new winter menus,” Josh said. “Business in October saw a marginal pick-up of 0.4% compared with September.
“We look to Christmas parties and gatherings as key revenue drivers for the rest of the year. Although these haven’t been totally booked up yet, it feels as though people are increasingly leaving making bookings late. There do seem to be concerns about inflation and petrol price rises. Bearing this in mind we’re taking a cautious view as we look to the future.”
Visa is tracking the sentiment of several small businesses across the UK on a monthly basis, asking about their views on the economy, business conditions and forecasts for the month ahead.