Struggling Britons cut back on beer and meat to make ends meet during the cost of living crisis, according to a new analysis.
The traditional favourites of barbecue season were the first to be sacrificed when people were looking to do away with non-essentials.
Spending has also been reduced on recreation and big ticket purchases for the home, such as washing machines.
The details come from an analysis of spending habits using official data by the Financial Times.
Consumer spending has yet to return to pre-pandemic levels in Britain, underperforming the US and eurozone.
UK households slashed purchases of beer by 15 per cent, confectionery by 10 per cent, meat by 7 per cent, and bread and fruit by 9 per cent each in the two years to the final quarter of 2023, shows an analysis of detailed consumer spending figures from the Office for National Statistics (ONS).
The trend partly reflects the impact of the pandemic, together with the fact household finances have hit by a rise in interest rates to a 16-year high.
The analysis found people have been spending more but getting less for their money over the two years. Cash spending was up 15 percent over the two years that this purchased 0.5 percent fewer goods.
The volume of food purchased by consumers was 8 percent lower, even as spending on groceries increased by 16 percent over the past two years.
At the same time households spent 70 percent more on gas to heat their homes, but consumption fell 10 percent as many rationed their use.
Tomasz Wieladek, chief European economist at investment company T Rowe Price, told the FT: “The cost of many essential items, such as energy and food, has risen dramatically in the past two years, and wages have not kept up with the large rise in prices. Given household budget constraints, something had to give.”
He added: “Households had to cut back on many non-essential items such as goods and luxury services”, as well as on energy consumption, and switched away from more expensive branded foodstuffs.
UK consumer price inflation peaked at a 42-year high of 11.1 per cent in October 2022, while real wages contracted for most of 2022 and 2023. Inflation dropped to 3.2 per cent in February, but prices remain about 20 per cent above their mid-2021 levels.
ONS data shows inflation-adjusted spending on household appliances, such as coffee machines and dishwashers, dropped 19 per cent in the two years to the end of 2023 and was 8 per cent below pre-Covid levels.
Real spending on furniture was down 9 per cent, with fewer purchases of cars, plants, jewellery and insurance.
Overall, household real spending in the final three months of 2023 was 2.4 per cent below its level in the same period of 2019. This compares with an 8 per cent expansion in the four years to the end of 2019.
British households fared worse than others, official data suggests. In the US consumer real spending rose 10 per cent from pre-pandemic levels in the final three months of 2023, and Britain’s performance was weaker than that of the eurozone and Canada.
The sharper contraction in consumer spending in the UK “was probably largely due to the UK’s higher and longer-lasting inflation problem”, said Ruth Gregory, economist at research company Capital Economics.
She added: “The UK had the worst of both worlds, a big energy shock like the eurozone and worse labour shortages like the US.”
Mark Boyd-Boland, partner at consultancy LEK, said that in addition to cutting discretionary spending, consumers had “sought to moderate what they bought at the grocery store”, buying “a few less of the nice things” and downgrading to supermarket own-label items.
