Brexit ‘hesitancy’ could impact Christmas spending

Could Brexit make shoppers more cautious over the festive period?
Could Brexit make shoppers more cautious over the festive period?

A report has warned consumer spending may be affected over the Christmas period, as households wait for clarity over Brexit.

The paper from the Leeds City Region Enterprise Partnership (LEP) also claims “hesitancy” has spread to the housing market.

It added that, despite strong recent performance from industries in the region, continuing uncertainty around Brexit will “pose challenges” to areas such as logistics and hospitality.

The report, which is set to go before members of the LEP board this week, states: “At city region level, the labour market remains relatively strong with

employment increasing and unemployment decreasing.

“However, it is notable that some of the sectors that have seen strong employment growth of late are among those with reliance on EU workers which may pose a challenge to these industries in future, most notably logistics and hospitality sectors.

“The region’s goods exporters continue to see the benefit of sterling’s fall and have seen export activity expand strongly in the past two years.

“This may be a factor in the continuing levels of confidence among the region’s businesses, who remain more optimistic than those in most other regions. The apparent fall in new business starts does however suggest a degree of hesitancy in some quarters.

“That same hesitancy is evident in the housing market, where sales volumes point to a slowdown despite rising prices.

“Many households, like businesses, appear to be waiting for clarity and confidence in future arrangements before making significant investment decisions. This pattern may be more evident in the consumer sector as it enters the critical Christmas trading period.”

However, the report added that, since the EU referendum took place in June 2016, Yorkshire and the Humber saw a bigger percentage growth in its goods exports than any other region in the country.

The draft Brexit agreement is set to be considered at an EU summit this weekend, but it has yet to be signed off by Parliament.