Government spending cuts hit the high street
Today's figures from the Office for National Statistics show that retail sales in the UK have fallen by 0.5% in August which is the first reduction in over six months. The sale of food, fuel, clothes and household goods were all down with non-food stores also showing a significant drop of 0.7% in overall sales. The overall decline in food stores sales was 0.5% over the period and the Office for National Statistics has also revised downwards the growth seen in July from 1.1% (which had surprised many people) to 0.8%.
There is no doubt that the threat rather than the immediate impact of public-sector investment cuts is beginning to take a toll on the UK high street. It is highly likely that the situation will get worse before it gets better as the real impact upon the high street has yet to come. The UK government needs to push ahead with budget cuts in the short to medium term to protect the UK credit rating on international money markets although there will be enormous pain in the short term.
As many people had forecast, this particular period in office is turning out to be something of a poisoned chalice and David Cameron and his coalition partners will do well to turn the situation around to their benefit.
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