Retailers and the hospitality industry are bracing for a significant boost in consumer spending as Labour’s recent election victory coincides with a big weekend of sporting events, including England’s Euro 2024 match and Andy Murray’s possible final appearance at Wimbledon.
Businesses across the UK are expected to benefit from a surge in consumer confidence following Keir Starmer’s election victory, combined with the excitement generated by major sporting events. Historical trends show that a change in government often boosts economic activity, with previous post-election periods in 1997 and 2010 seeing increases in consumer confidence and retail spending, according to research from GlobalData and PwC.
The coming weekend promises a real spending bonus, culminating in England’s Euro 2024 quarter-final against Switzerland and a doubles match at Wimbledon with Emma Raducanu and Andy Murray. GlobalData predicts an economic boost of £419.5 million from football fans alone, with 24.8 million Brits expected to watch the match in England, many of whom will gather in pubs and bars.
Tesco expects strong alcohol sales and predicts sales of 3.5 million units of beer and cider, supplemented by 1 million packs of sausages and 1.3 million punnets of strawberries. Fans are expected to consume 13.4 million pints in pubs while supporting the Three Lions.
The festive atmosphere extends to champagne searches, which are up 36% at Ocado, possibly driven by both hopeful Labor supporters and enthusiastic football fans.
Before the election, almost 36% of consumers said they would feel more confident about their spending if Labor won, a sentiment even stronger among younger demographics. Noting the positive outlook, PwC’s senior retail advisor Kien Tan said: “July will have a bit of a halo effect,” referring to current economic conditions and consumer confidence.
The Labor government’s expected policy changes, such as cuts to national insurance and increases in the minimum wage and pensions, are expected to further boost consumer spending. The retail and hospitality sectors are likely to outperform last year’s sales, which were dampened by poor weather and competition from popular films such as Barbie and Oppenheimer.
Patrick O’Brien, research director at GlobalData, highlighted the renewed optimism in retail, especially among younger consumers. The expected mini-boom also reflects a response to declining spending ahead of the elections, with households postponing major purchases amid uncertainty.
With the new government in place and the weather improving, the UK retail and hospitality sectors are set for a summer of robust spending, fueled by political changes and an exciting sporting calendar.