Shopping priorities revealed for life in lockdown by Halifax bank experts

A major shift in consumer spending habits has been triggered by the “isolation economy” as people buy more of four ‘‘staples’’ while they stay at home, analysis reveals.
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But while adults are spending to £12.9bn a year more on groceries, alcohol, entertainment and hobbies and crafts, the research shows, UK households are still spending less overall.

This wider picture equates to a fall in expenditure of £215bn annually, according to Legal & General and the Centre for Economics and Business Research (CEBR) research.

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“The isolation economy is a new feature of our daily lives,” said Nigel Wilson, chief executive at Legal & General.

Halifax managing director Russell Galley.Halifax managing director Russell Galley.
Halifax managing director Russell Galley.

“As the hub of the isolation economy, the home is becoming a more flexible space, doubling up as a place for schooling, work, fitness and entertaining – and we can expect changes to the way we think about and design homes for future home owners.”

People in employment were found to spend an average of £107 a week on the four key areas, a 10 per cent rise on pre-lockdown levels.

The biggest spend was on groceries, while adults aged 35 to 54 were the ones driving the biggest increase and spending on average of £89.94 per week.

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Under-35s spend £56.90 in comparison, while over-55s faced a bill of £70.94 per week typically.

The biggest increase was among those who had seen no change to their employment, who found themselves spending 14 per cent more on groceries, compared to nine per cent for all adults.

More than half of people, meanwhile, said they would be willing to pay more for products that have been made in Britain, rather than imported from overseas.

It comes as analysis of customers’ spending habits from Halifax Bank suggests nearly half of debit card transactions made in recent weeks have been online.

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The bank, looking at data up until April 19, found online spending had risen by a fifth since last year, with record numbers of older people signing up to digital banking.

“The surge in online payments and demand for internet banking is primarily driven by the unprecedented situation many people currently find themselves in,” said Halifax managing director Russell Galley.

“When we look at this across different age groups, we have seen a much greater shift amongst those aged over 65.”

In the 28 days after lockdown was introduced, online registrations for internet banking surged by 63 per cent among over 65s, and contactless payments are continuing to increase.

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But while many older people may be embracing new ways to pay, concerns have also been raised that Covid-19 could hasten the decline of cash use generally and increase the risk that some people who rely on cash are left behind.

Adults are dedicating an additional 20 minutes each week to fitness under lockdown, the new research suggests, while they also spend around two-and-a-half hours longer watching TV and gaming.

Nearly a fifth of those who have taken up a language or educational class over recent weeks intend to keep it up in the longer term, the research suggests, and more than two-thirds of people say they plan to cook more meals at home in the future.

One of the biggest shifts may be seen in people shopping locally, with 60 per cent of households planning to support local stores to help the economy in the longer term.