Shoppers in the South East start their Christmas shopping early in the year as they tighten their spending

• 20% in the South East say that they’ll be getting their Christmas shopping underway early this year

• Over 30% of shoppers in the region will be spending less on celebrations compared to 2022

• PwC Consumer Sentiment remains stable at -13 from the summer survey 

• Largest gap on record between the most and least affluent 

• 30% say they’ll spend less on Christmas shopping, primarily due to the cost-of-living

PwC released its seasonal sentiment survey results on October 16, with 20% in the South East region saying that they have already started their Christmas shopping. The majority (60%) stated they will start preparing for the festive season about the same time as usual, while 15% are aiming to start shopping earlier this year.

A larger proportion of the region is planning to cut back on spending. 33%  said they’d be spending less, with 78% of UK respondents citing the rising cost of living as the main reason for tightening their expenditure. Only 15% in the South East plan to spend more than they did last year. 

Among all the regions, only in London do 33% of consumers expect to spend more on Christmas than they did in 2022.

Across the UK, the results are holding firm from the previous edition in the summer. Overall the -13 sentiment reading remains the highest point for 18 months and an improvement of over 30 points since the low of -44 in Autumn 2022, which was the worst score recorded since the Global Financial Crisis in 2008. 

Despite sentiment holding firm, the widest gap on record (52 ppts) now exists between the most and least affluent socioeconomic groups since the survey began. Sentiment is still improving amongst over 55s and the most affluent, but it is falling in every other demographic group, particularly sharply among under 25s and the least affluent. 

Now 45-54 year olds expect to be the worst off across all age groups, with under 25s also dropping below 25-34 year olds. The trend for under 25s is unusually low for this time of year - autumn has historically seen a more positive trend as young people head into the world of work or education. However, those under 35 do remain in net positive territory - as they have done historically - driven by more younger people living at home, being more likely to have benefitted from wage rises, less likely to have been affected by mortgage rate rises, and having more disposable income as a result. 

Almost identical to the last consumer sentiment survey, the less affluent and 35-54 year olds remain under the greatest financial pressure, while retirees are the group reporting the most resilient household finances. For example, 44% of over 65s say they have money left at the end of the month for luxuries or to save, compared with 23% of 35-44 year olds.

Overall, just under a third of adults report that their household finances are ‘healthy’, a slight improvement on this time last year. At the other end of the scale, fewer than one in ten say they are either struggling to make ends meet or have missed bills or loan repayments. This number rises to 15% of 45-54 year olds, and to just under a quarter of the least affluent socioeconomic group.

With financial considerations in mind, consumers are shopping earlier than in previous years, and many are expecting to spend less on Christmas. Already 1 in 5 had started their Christmas shopping by mid-September, with more than 1 in 3 saying that they either have started their shopping or are planning to shop earlier this year.

However, only 18% of adults say they expect to spend more on shopping and celebrations this Christmas, with just over half saying they will spend the same as last year. That means that almost one in three adults say they expect to spend less this year, with the overwhelming reason being due to the rising cost of living: just under 80% of those who plan to spend less say it’s because of rising food and energy costs, compared with only 23% citing mortgage or rent payments. 

David Beer, Consumer Markets Lead for the South East, said:

“As we look back at the past year, there's a notable improvement in all economic indicators since the 'mini-Budget,' which is a positive sign. However, beneath the surface of this flat sentiment, warning signs are emerging, revealing a growing divide between generations and income brackets. We are currently witnessing the widest gap between the more affluent ABs and the less affluent Es since the survey's inception, a staggering 52-point difference.

“Interestingly, the spending landscape has undergone a significant shift, with category spending now in negative territory across the board, including essentials like groceries. Christmas is on the horizon, and the good news is that shoppers tell us they want to protect their spending on family and special occasions by starting preparations early and being cautious. However, more consumers expect to spend less this Christmas compared to those planning to spend more. This shift is primarily attributed to the escalating cost of living, particularly concerning food and energy costs, rather than mortgage or rent expenses.”