Retail sales growth slows as shoppers rein in non-essential spending
Retail sales rose just 1% year-on-year in May, marking the slowest growth recorded so far in 2025 as shoppers tightened their grip on non-essential spending.
Retail sales rose just 1% year-on-year in May, marking the slowest growth recorded so far in 2025 as shoppers tightened their grip on non-essential spending.
According to the latest BRC-KPMG Retail Sales Monitor, growth in total sales slowed from 0.7% in the same month last year, with non-food sales slipping 1.1% year-on-year – unchanged from the same month in 2024.
In-store non-food sales were down 0.9%, while online non-food sales dropped by 1.5%. The proportion of non-food items bought online remained flat at 35.9%.
Food sales, meanwhile, remained resilient, rising 3.6% in May – a modest uptick from 2.8% growth the same time last year, bolstered by two bank holidays and the end of key football tournaments.
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BRC chief executive Helen Dickinson said: “Consumers put the brakes on spending, with the slowest growth in 2025 so far. This was due largely to declines in non-food sales, as fashion and full price big-ticket items were held back by lower consumer confidence.
“Gaming bucked the trend, thanks to some popular new releases. Food sales remained solid as the month saw the conclusion of football tournaments and two bank holidays, prompting spending on BBQs and picnics.”
Dickinson warned that cost pressures continue to weigh heavily on the industry, with retailers facing an extra £5bn from higher National Insurance contributions and wage increases that came into effect in April, alongside a further £2bn in costs expected later this year from new packaging taxes.
“Retailers remain concerned about the consequences of the Employment Rights Bill,” she added.
“Ensuring the new Bill supports workers’ rights without undermining retailers’ ability to continue to provide jobs and investment in people will determine whether Government achieves economic growth across the country or not.”
KPMG UK head of consumer, retail and leisure Linda Ellett said the sunny weather failed to translate into stronger retail performance.
“Early seasonal purchases were likely a factor, as was a dampening of some spending appetite as households reflected upon the recent combination of essential bill rises,” she said.
“But May still saw slight growth, driven mainly by food and drink, with non-food purchases falling overall. Travel demand for the summer months ahead looks healthy, so retailers will be hoping June sees an upturn in related spending as people begin to think about what they want to pack in their suitcase.”
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