Footfall in shops plunged 27 per cent last week as lockdown hammers economy

Footfall at shops plunged more than a quarter last week as the brutal lockdown hammers the economy.

Total shopper numbers tumbled by 27.1 per cent in the seven days to January 9 compared to the previous week. 

The grim figures from research group Springboard emerged as Rishi Sunak prepares to face MPs for the first time since announcing a bailouts to prop up businesses.

But he is facing calls to go even further amid warnings that many normally thriving firms are ‘fighting to survive’.

Treasury sources insisted Mr Sunak will not be announcing any new measures in his statement to the Commons this afternoon, billed as an ‘update’ after the dramatic events last week.

Springboard said the reduction in footfall was 35 per cent week-on-week in shopping centres, 26 per cent in high streets and 21.3 per cent in retail parks.

The organisation’s director During the first full working week of 2021 and introduction of lockdown 3.0, the reduction in footfall across UK retail destinations from the week before was nearly as great as that during early November when England entered lockdown 2.0,’ said Springboard director Diane Wehrle.

On a year-on-year basis, footfall across all UK retail destinations was 63.8 per cent lower than in the same week last year.

Last week Mr Sunak hinted furlough could be extended again as he announced another £4.6billion of bailouts for lockdown-stricken businesses – with economists warning of the ‘colossal’ hit from the surging pandemic.

Venues hammered by Boris Johnson‘s dramatic decision to impose a new lockdown are getting one-off grants of up to £9,000 to keep them afloat over the next seven weeks.

Some 600,000 premises across the UK are set to receive the cash, while another £594million is being pumped into a ‘discretionary fund’ to support other firms affected.

Despite the running costs of the coronavirus response spiking above £300billion, Mr Sunak has pointedly refused to rule out keeping the massive furlough scheme beyond the end of April, merely saying he would ‘take stock’ at the Budget in March.

However, businesses warned that the package is not enough, amid pressure for VAT and rates relief to be kept in place to stop a wave of bankruptcies.  

There are fears that the lockdown will slash GDP by up to 10 per cent in every month it is imposed – although the respected IFS think-tank has said the impact might be lower as businesses have adapted since the first squeeze in March.

The government’s finances are also under pressure with borrowing set to top £400billion this year, and Mr Sunak already having warned of a reckoning later to balance the books. 

A regional breakdown of the Springboard figures showed Central London has seen a far greater drop in footfall than suburbs, at 25.9 per cent week on week compared to just 6.8 per cent.  

Although the figures showed the weekly decline in footfall was nearly as great as in the second lockdown – suggesting Britons were complying with the call to stay at home – traffic data painted a different picture. 

This revealed that rush-hour congestion in London this morning was at its highest level since England’s third national lockdown began – adding to concerns that fewer people are abiding by the restrictions than during previous shutdowns.

The pandemic had already sounded the death knell for retailers including Oasis, Warehouse, Laura Ashley and Debenhams, and the stark figures do little to ease the sense of uncertainty in the sector. 

Paperchase is the latest retailer to come into trouble, and earlier this month announced it is on the brink of administration after Covid restrictions placed ‘unbearable strain’ on the card and gift retailer’s Christmas sales. 

Today’s footfall results varied dramatically by geography.

In the South West, the East and West Midlands and North & Yorkshire the decline in footfall from the week before exceeded 35 per cent and reached over 40 per cent in the East Midlands and the South West.

However, in the South East and Greater London, which have the highest infection rates, footfall only declined by 8 per cent and 10.7 per cent respectively. 

However, in London this was driven by Outer London areas where the drop in footfall was only 6.8% versus 25.9% in Central London.

Despite this, the drop in footfall in Central London was still noticeably less than in regional cities outside of the capital where footfall declined by 39.6 per cent.

In Wales and Northern Ireland footfall actually rose from the week before (by 10 per cent in Wales and by 27.1 per cent in Northern Ireland), although despite these increases footfall in both nations remains two thirds lower than last year. 

Shadow business secretary Ed Miliband today pointed to research showing 250,000 small businesses could fold without more support.

‘The message from businesses is clear: support is not remotely equal to the scale of the emergency,’ he said.

‘Many are excluded, grants do not properly cover the costs facing firms, businesses are staring at fast approaching cliff-edges in support and there is a massive issue of the debt burden they have accumulated.

‘The Government’s approach throughout this crisis means the UK is already facing the worst crisis of any major economy. 

‘Rishi Sunak must start listening to the businesses fighting for survival and come up with a proper plan for the months ahead which matches the gravity of the crisis.’