The early proof that consumers are seeking to trim their household bills was offered this week when Marks & Spencer said its food sales had plummeted by 5.9 per cent and Waitrose, the middle-class's food retailer of choice, saw its weekly sales fall by 0.7 per cent.
Falling demand for high-end foodstuffs is balanced by the booming popularity of "bargain Thursday". Strong demand for the cheap goods offered every Thursday by the German supermarkets Aldi and Lidl, along with their Danish competitor, Netto, is symptomatic of significant sales growth for the discount chains.
Amid reports that Aldi and Lidl are considering expansion into wealthier neighbourhoods, it was announced last week that the two German retailers gained market share to 2.4 per cent and 2.9 per cent, and increased sales by 19.8 per cent and 12.3 per cent respectively.
Tesco, which announced a new price-cutting "value" range last week, saw its market share fall by 0.2 per cent but announced profits growth of 10 per cent to £1.45bn for the first six months of this year. Sainsbury's, which announced strong sales yesterday, said it was taking customers from Waitrose.
Predictions that top dining spots will suffer have been met by rising demand for less glamorous eateries. McDonald's has seen its sales rise by 8.5 per cent, while Domino's Pizzas, the home-delivery pizza chain, has seen sales rise by 8.9 per cent and will have opened 50 new outlets by the end of the year.
HOUSING
Average home values have fallen by £23,000 from their peak last year, according to the Nationwide, and the 12.4 per cent annual drop in prices is the largest ever seen by the building society.
But those figures are based on a low volume of transactions (mortgage lending has collapsed by more than 90 per cent) and the true picture could be much worse. Auction prices are down 25 per cent and there is evidence that newly built flats in northern cities are being sold for half their original price.
Repossessions are rapidly rising, particularly in the South-west of England, where high demand and low supply have led to record borrowing. Experts say there is still plenty of room for prices to fall further. The most dire prediction is that values will fall to 35 per cent below their peak. That means another £40,000 still to go on an average home.
But the Royal Institute of Chartered Surveyors reported the highest increase of new rentals in its history and said profits for landlords were increasing.
HIGH STREET
Retailers are already feeling the effects of a consumer spending downturn. The fashion chain Miss Sixty and curtains-to-duvets group Rosebys have already gone into administration while the sports retailer JJB is in dire straits.
Amid warnings from one City analyst that the British high street is heading for its worst Christmas in 30 years, an insolvency specialist warned this week that 323 UK retailers are on a "critical watch list" with a 70 per cent chance of failing in the new year. Begbies Traynor said banks will call in debts on poorly performing chains once they have reduced as much of their stock as possible.
Predictions that traditional retailers who have failed to establish a strong online presence will suffer most are borne out by companies such as the internet fashion retailer Asos. The online store, whose name stands for As Seen On Screen, targets 18 to 34-year-olds with a range from designer brands to reproductions of celebrity outfits. It has doubled sales in six months. Other "cheap and cheerful" shops such as Primark and TK Maxx have all reported strong sales.
But with stalwarts such as John Lewis and Marks & Spencer reporting sharp falls, the gloom is difficult to dispel. Consumer spending accounts for two thirds of the cash that keeps the British economy going.
MANUFACTURING & TECHNOLOGY
The lunchtime queue outside a cobbler's shop in the heart of the City this week was symbolic proof that times are tough for those who make things. While bankers wait to repair their shoes and fix their watches, British manufacturing production has now fallen every month since March. Yesterday it was announced that output fell by 0.4 per cent in August – twice the expected rate of decline.
The result is plunging profits, production and confidence. New car registrations fell by a calamitous 21 per cent in September with sales of large cars particularly poor. Staff at Land Rover and Ford's Transit van production line in Southampton have been put on a four-day week.
Technology is also doing badly with the electrical and optical sector output falling by 3.1 per cent in August, while food and drink production fell by 1.6 per cent. The ability of the manufacturing sector to counterbalance poor performance in the service sector has been dented by the loss of a million jobs in the last decade.
Economists are expecting three or four quarters of negative growth, before growth picks up in 2010. Unemployment jumped by 32,000 in August and the prediction is for between 300,000 and two million more job losses by Christmas.
It falls to the likes of James Timpson to profit. The owner of the shoe repair chain, which has 638 stores and will have 40 more by the end of the year, said: "Because things are tight, rather than pay for a pair of new shoes people are choosing to get them repaired. We have seen a 4 per cent increase in shoe repairs in the past three months and a 17 per cent increase in watch repairs. If people don't have as much spare cash they aren't as likely to treat themselves to a new watch."
SPORTS, ARTS AND LEISURE
The first economy measure that could be expected for many households is the £400 a year that Sky viewers pay for Premiership football. A sport that has generally increased season tickets far above inflation for 16 years and relies on sponsorship and corporate entertainment for much of its income should be facing a crisis. But with income from the Sky television deal guaranteed until 2010 and most clubs recording near-full attendances (including corporate boxes), the Premiership seems recession proof. The signs are not good elsewhere in sport. Cricket's County Championship attracted only modest crowds.
The sharp drop in commodities prices, the source of rapidly-increasing wealth for Russian and Middle Eastern plutocrats, may halt the success of contemporary art auctions like Damien Hirst's £122m Sotheby's sale last month.
The trend will be towards less grandiose forms of entertainment. Cinema attendances were at their highest level for almost 40 years this summer thanks to the "feelgood escapism" of films like Mamma Mia!
Housing equity withdrawal, whereby homeowners swap the increase in the value of their homes for an increased mortgage, has fallen from £10bn in the second quarter of last year to zero, with a drastic knock-on effect for the holidays and home improvements it funded.
THE PUBLIC SECTOR & CHARITIES
While their confrères in the private sector may be feeling the chill wind blowing through the economy, public servants, who have suffered below-inflation pay deals for the past three years, can take small comfort from the fact that in the short term at least they are insulated from the effects of the crisis.
The problem comes when the Chancellor has to balance the public finances by raising taxes or cutting public services. Mr Darling has said any attempt by unions to renegotiate three-year public sector pay deals would be resisted.
Shrinking disposable incomes have had a similar effect on charities. A survey by the Charities Aid Foundation found almost a third have seen donations fall in the past year, while 72 per cent have seen an increase in demand for their services and 71 per cent have reported an increase in their costs.
BANKING
With sector losses predicted by the IMF to reach £800bn, banking is at the root of the crisis. The City, accounting for about a quarter of the value of the UK economy, is predicted to suffer more than 100,000 job losses.
Away from the tainted merchant banks, the crisis has also hit high street institutions. The nationalisation of Northern Rock led to the loss of 2,000 staff with more certain to follow at Bradford & Bingley, Alliance & Leicester and HBOS.
Consolidation of the sector, which will be dominated by HSBC, Barclays, RBS and the proposed Lloyds Halifax, will lead to less competition, fewer loans and dearer current accounts.
TRAVEL & TRANSPORT
Even by the standards of an industry inured to periodic collapses and steep downturns, the crisis facing the aviation sector is dramatic, with up to 30 airlines expected to go bust over the next 18 months.
It will be the bus and the train taking the strain. National Express, the Birmingham-based group, has enjoyed steady growth in passenger numbers while Eurostar reported a 25 per cent increase in ticket sales in the first half of 2008.
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