Consumer confidence has declined significantly over the past three months, according to two surveys published Thursday.
Almost half of respondents (48%) to a poll from the British Retail Consortium expect the UK’s economic position to worsen, against 42% and 38% in the previous two months.
A sixth of those surveyed see things getting better.
Older respondents were the most concerned, said the BRC, with those aged under 27 the most optimistic.
Helen Dickinson, BRC’s chief executive, said the constant barrage of gloomy headlines was affecting people’s moods.
“As the government warns of tough times ahead, it is little surprise that the public has caught the January blue.
“Expectations of retail spending and wider spending both fell significantly, though much of this is likely to be the end of the Christmas period, as people tightened their belts for the new year ahead,” she said.
“On top of this challenging market backdrop, retailers are facing £7bn in additional costs from the Budget and new packaging levy. With retailers’ tight margins leaving little scope to absorb more costs, many are warning of price rises and job cuts in the coming months.”
A survey by consumer group Which? also found a majority expect the economy to weaken, with 62% of those quizzed expecting things to get worse.
The news came just ahead of grocery giant J Sainsbury PLC (LSE:SBRY) cutting 3,000 jobs and its cafés, which it said was to simplify the business.