Business

Why Scrooges will abound this Christmas...

Northern Ireland consumers to shell out much less on gifts this Christmas, new survey shows

One in six (16%) people in Northern Ireland will spend less than 2022 on presents and celebrations, according to a survey from PwC, with only 6% expected to splash more cash than a year ago
One in six (16%) people in Northern Ireland will spend less than 2022 on presents and celebrations, according to a survey from PwC, with only 6% expected to splash more cash than a year ago One in six (16%) people in Northern Ireland will spend less than 2022 on presents and celebrations, according to a survey from PwC, with only 6% expected to splash more cash than a year ago

HARD-pressed consumers in Northern Ireland intend to shell out much less on gifts this Christmas - and will instead choose to fork out more on food and stay at home for their main celebrations.

And interestingly, more people will bring out their inner-Scrooge and actually don't intend to spend anything at all this year in a bid to combat cost of living pressures.

A UK-wide predictions survey by business advisers PwC, deep-diving into how consumers will behave this season, says the average spend will drop by roughly £40 a head to around £400.

That, however, still equates to an overall spend of £20 billion.

The survey shows that one in six (16%) in Northern Ireland will spend less than 2022 on presents and celebrations, with only 6% expected to splash more cash than a year ago.

And while more than a fifth are planning to do most of their Christmas present shopping earlier than in previous years, one in 20 intend to make a last-minute retail dash by leaving their purchases to just a few days before the 25th.

While consumer sentiment in the north has shown a clear improvement since the start of the year, the PwC findings point to more subdued intentions going into Christmas.

Financial pressures account for the top three reasons among those expecting to spend less, with 48% saying they have less money to spend, 43% saying their personal finances have been hit by the cost of living, and 30% saying they are simply less confident of their personal finances in the coming year.

Aine O’Hare, tax partner at PwC Northern Ireland, said: “While consumers say they expect to spend less this festive season, there is a good chance people will spend more than they think, because last year they on average ended up spending around 15% more (£3bn) than anticipated.

“So December trading will be critical for Northern Ireland retailers. And last-minute shoppers in the week before Christmas mean the tills will be ringing right up to Christmas Eve, particularly as our research shows men are twice as likely to leave their shopping until that week.”

Jason Calvert, director and economist at PwC Northern Ireland, adds: “Inflation may have eased, but people here are still feeling the pressure of rising costs, so it makes sense that many are planning their festive spending carefully.

“But the combined impact of lower inflation and higher real wages could provide a boost for local retailers as consumers who plan to shop later in December might have more disposable income to play with than originally expected.

“In terms of what people are spending their money on, we are seeing them prioritising spending on their Christmas dinner and on food and drink more broadly.

“This is especially true for Northern Ireland consumers as 70% of people intend to spend Christmas at home with family, so will need to stock up on festive treats.”

Meanwhile separate research from the Citizens Advice Bureau found that seven in 10 families admit they will struggle to budget for Christmas, which this year will cost the average family more than £730.

Worryingly, it also shows that almost a third of UK adults are expected to fund Christmas by using Buy Now Pay Later (BNPL) schemes, effectively a quick-fix for now but likely to have potential longer-term financial consequences.

The Citizens Advice study found that 21% of BNPL users miss a payment or pay late, and 10% are visited by enforcement agencies or bailiffs as a result.