The retail sector will rebound in the middle of this year with spending driven by £100 billion ($137.31bn) in excess savings consumers have built up during lockdowns, according to global consultancy PwC.
However, increased unemployment as the furlough scheme ends will drag on consumer spending overall, while the expiry of the stamp duty holiday on March 31, falling birth rates and immigration levels will have a downward effect long term.
Nick Forrest, director of economics and policy at PwC, said the first quarter of this year would be very challenging for retailers and the wider economy, however, the release of savings from the second quarter will help the economy rebound strongly.
“We do see quite a strong recovery as we get the vaccination programme through,” Mr Forrest told a virtual briefing on Thursday.
“We're going to live in a quite a strange world with people who have had Covid, people who have had the vaccine and people who haven't and people still concerned and isolating … so, for politicians and retailers, navigating to different segments of people throughout the next few months will be quite a challenge.”
Mr Forrest said the recovery might tail off in the longer term as challenges around unemployment and businesses that have been disrupted start to manifest. “The last part of recovery will take a little bit longer after that initial strong period,” he said.
Consumer spending will surge this summer, driven by a £100bn build-up in savings for individuals whose incomes have been unaffected by the cycle of lockdowns, with the recovery phase also boosted by low interest rates.
However, this will be offset by the end of the government’s furlough scheme, which is expected to drive up unemployment.
“The government will try and make that gradual and limit the impact on employment but it's inevitable we're going to see more unemployment and that will be a drag on consumer spending,” said Mr Forrest.
Another drag factor will come from the falling birth rate and lower immigration levels from the EU. According to the Economic Statistics Centre of Excellence, an "unprecedented exodus" from the UK of foreign workers during the pandemic contributed to a 1.3 million fall in the population between the third quarter of 2019 and the same period in 2020.
Meanwhile, 58 per cent of those planning a child delayed trying for a baby during the crisis, according to a PwC study.
“We are now nine months on from the first lockdown, so we might start to see the impact on the birth rate through this year and it’s possible the birth rate might be at the lowest point in the last 100 years, which will have an impact on certain segments such as the retail market," Mr Forrest said.
British retailers suffered their worst annual performance on record in 2020, as the series of lockdowns took its toll on fashion and homeware sales.
The sector suffered an overall fall in sales of 0.3 per cent on the year, according to the British Retail Consortium-KPMG retail sales monitor, with the typically bumper Christmas period offering little respite for high street stores.
Some of Britain's largest retailers closed last year, with department store Debenhams shutting up shop in December and retail tycoon Philip Green's Arcadia fashion group entering administration.
Despite Covid restrictions in December that forced non-essential shops to shut for part of the month, UK inflation rose to 0.6 per cent as consumer prices jumped from a 0.3 per cent annual increase in November, driven higher by transport and clothing costs.
Mr Forrest said inflation will rise to 1.5 per cent this year, but there will not be runaway spending because the coronavirus outbreak has not been an inflationary crisis but a “crisis of economic activity”.
While 30 per cent of consumers do not expect life to return to normal until autumn, PwC said, one of the biggest shifts experienced last year was the retail sector’s acceleration to online.
The sector experienced seven years’ of online growth in seven weeks at the start of the Covid-crisis, according to Lisa Hooker, PwC's leader of industry for consumer markets, which enabled retail to fare better than most industries in terms of gross domestic product last year.
While footfall was "decimated" in the first lockdown and currently sits about minus 77 per cent, online retail “saved the day” and “rescued” what could have been an even worse year, Ms Hooker said.
The specs
Engine: 3.9-litre twin-turbo V8
Power: 640hp
Torque: 760nm
On sale: 2026
Price: Not announced yet
Pharaoh's curse
British aristocrat Lord Carnarvon, who funded the expedition to find the Tutankhamun tomb, died in a Cairo hotel four months after the crypt was opened.
He had been in poor health for many years after a car crash, and a mosquito bite made worse by a shaving cut led to blood poisoning and pneumonia.
Reports at the time said Lord Carnarvon suffered from “pain as the inflammation affected the nasal passages and eyes”.
Decades later, scientists contended he had died of aspergillosis after inhaling spores of the fungus aspergillus in the tomb, which can lie dormant for months. The fact several others who entered were also found dead withiin a short time led to the myth of the curse.
Results for Stage 2
Stage 2 Yas Island to Abu Dhabi, 184 km, Road race
Overall leader: Primoz Roglic SLO (Team Jumbo - Visma)
Stage winners: 1. Fernando Gaviria COL (UAE Team Emirates) 2. Elia Viviani ITA (Deceuninck - Quick-Step) 3. Caleb Ewan AUS (Lotto - Soudal)
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F1 The Movie
Starring: Brad Pitt, Damson Idris, Kerry Condon, Javier Bardem
Director: Joseph Kosinski
Rating: 4/5
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At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
It’ll be summer in the city as car show tries to move with the times
If 2008 was the year that rocked Detroit, 2019 will be when Motor City gives its annual car extravaganza a revamp that aims to move with the times.
A major change is that this week's North American International Auto Show will be the last to be held in January, after which the event will switch to June.
The new date, organisers said, will allow exhibitors to move vehicles and activities outside the Cobo Center's halls and into other city venues, unencumbered by cold January weather, exemplified this week by snow and ice.
In a market in which trends can easily be outpaced beyond one event, the need to do so was probably exacerbated by the decision of Germany's big three carmakers – BMW, Mercedes-Benz and Audi – to skip the auto show this year.
The show has long allowed car enthusiasts to sit behind the wheel of the latest models at the start of the calendar year but a more fluid car market in an online world has made sales less seasonal.
Similarly, everyday technology seems to be catching up on those whose job it is to get behind microphones and try and tempt the visiting public into making a purchase.
Although sparkly announcers clasp iPads and outline the technical gadgetry hidden beneath bonnets, people's obsession with their own smartphones often appeared to offer a more tempting distraction.
“It's maddening,” said one such worker at Nissan's stand.
The absence of some pizzazz, as well as top marques, was also noted by patrons.
“It looks like there are a few less cars this year,” one annual attendee said of this year's exhibitors.
“I can't help but think it's easier to stay at home than to brave the snow and come here.”
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A State of Passion
Directors: Carol Mansour and Muna Khalidi
Stars: Dr Ghassan Abu-Sittah
Rating: 4/5
MATCH INFO
Uefa Champions League last-16, second leg:
Real Madrid 1 (Asensio 70'), Ajax 4 (Ziyech 7', Neres 18', Tadic 62', Schone 72')
Ajax win 5-3 on aggregate
Super Saturday race card
4pm: Mahab Al Shimaal Group 3 | US$350,000 | (Dirt) | 1,200m
4.35pm: Al Bastakiya Listed | $300,000 | (D) | 1,900m
5.10pm: Nad Al Sheba Turf Group 3 | $350,000 | (Turf) | 1,200m
5.45pm: Burj Nahaar Group 3 | $350,000 | (D) | 1,600m
6.20pm: Dubai City of Gold Group 2 | $300,000 | (T) | 2,410m
6.55pm: Al Maktoum Challenge Round 3 Group 1 | $600,000 | (D) | 2,000m
7.30pm: Jebel Hatta Group 1 | $400,000 | (T) | 1,800m
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Ramy%3A%20Season%203%2C%20Episode%201
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ABU%20DHABI'S%20KEY%20TOURISM%20GOALS%3A%20BY%20THE%20NUMBERS
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UAE%20PREMIERSHIP
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UAE currency: the story behind the money in your pockets
WHAT IS GRAPHENE?
It was discovered in 2004, when Russian-born Manchester scientists Andrei Geim and Kostya Novoselov were experimenting with sticky tape and graphite, the material used as lead in pencils.
Placing the tape on the graphite and peeling it, they managed to rip off thin flakes of carbon. In the beginning they got flakes consisting of many layers of graphene. But when they repeated the process many times, the flakes got thinner.
By separating the graphite fragments repeatedly, they managed to create flakes that were just one atom thick. Their experiment led to graphene being isolated for the very first time.
In 2010, Geim and Novoselov were awarded the Nobel Prize for Physics.
How to report a beggar
Abu Dhabi – Call 999 or 8002626 (Aman Service)
Dubai – Call 800243
Sharjah – Call 065632222
Ras Al Khaimah - Call 072053372
Ajman – Call 067401616
Umm Al Quwain – Call 999
Fujairah - Call 092051100 or 092224411
MO
%3Cp%3E%3Cstrong%3ECreators%3A%20%3C%2Fstrong%3EMohammed%20Amer%2C%20Ramy%20Youssef%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStars%3A%20%3C%2Fstrong%3EMohammed%20Amer%2C%20Teresa%20Ruiz%2C%20Omar%20Elba%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%204%2F5%3C%2Fp%3E%0A
Dr Afridi's warning signs of digital addiction
Spending an excessive amount of time on the phone.
Neglecting personal, social, or academic responsibilities.
Losing interest in other activities or hobbies that were once enjoyed.
Having withdrawal symptoms like feeling anxious, restless, or upset when the technology is not available.
Experiencing sleep disturbances or changes in sleep patterns.
What are the guidelines?
Under 18 months: Avoid screen time altogether, except for video chatting with family.
Aged 18-24 months: If screens are introduced, it should be high-quality content watched with a caregiver to help the child understand what they are seeing.
Aged 2-5 years: Limit to one-hour per day of high-quality programming, with co-viewing whenever possible.
Aged 6-12 years: Set consistent limits on screen time to ensure it does not interfere with sleep, physical activity, or social interactions.
Teenagers: Encourage a balanced approach – screens should not replace sleep, exercise, or face-to-face socialisation.
Source: American Paediatric Association
ENGLAND SQUAD
Goalkeepers Pickford (Everton), Pope (Burnley), Henderson (Manchester United)
Defenders Alexander-Arnold (Liverpool), Chilwell (Chelsea), Coady (Wolves), Dier (Tottenham), Gomez (Liverpool), James (Chelsea), Keane (Everton), Maguire (Manchester United), Maitland-Niles (Arsenal), Mings (Aston Villa), Saka (Arsenal), Trippier (Atletico Madrid), Walker (Manchester City)
Midfielders: Foden (Manchester City), Henderson (Liverpool), Grealish (Aston Villa), Mount (Chelsea), Rice (West Ham), Ward-Prowse (Southampton), Winks (Tottenham)
Forwards: Abraham (Chelsea), Calvert-Lewin (Everton), Kane (Tottenham), Rashford (Manchester United), Sancho (Borussia Dortmund), Sterling (Manchester City)
Gothia Cup 2025
4,872 matches
1,942 teams
116 pitches
76 nations
26 UAE teams
15 Lebanese teams
2 Kuwaiti teams
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