Retail spending in the Dublin economy declined by 3.9% QoQ in the first quarter of 2021 as Covid-19 restrictions limited activity in the sector.
Discretionary spending was the main casualty in Q1, dropping by over 20% QoQ as all but essential retail was closed. Household Goods spending was the strongest performer in the quarter and rose by 8.5% QoQ, though this growth rate was weaker than the equivalent rate for Q4 2020. Expenditure on both Necessities and Entertainment remained stable in Q1 – albeit at polar opposite levels of performance given the restrictions which applied. eCommerce, which may have benefitted from the lack of in-store post-Christmas sales in Dublin, maintained an upward trajectory with QoQ growth of 4.4%.
Mastercard SpendingPulse (Total)
On a YoY basis, retail spending also fell in the Capital. An overall contraction of 4% YoY was primarily influenced by declines in Discretionary (-57%) and Entertainment (-69.1%) spending. Necessities expenditure was up by 8% YoY. Household Goods expenditure, which is often considered to be a bellwether for consumer confidence, increased by 7.6% YoY. eCommerce continued to benefit from a ‘perfect storm’ for online sales over the past 12 months with exceptional growth of 45.1% YoY.
Q1 2021 Brings Little Respite for Tourism Spending
Tourist spending in Dublin and across Ireland remained at a very low ebb in Q1 2021. All markets posted significant YoY declines as international travel restrictions remained in place. The introduction in April of mandatory hotel quarantining for individuals travelling from or via a collection of over 70 countries will have done little to improve the situation in Q2 of this year.
“Retail sales in Dublin contracted by 4% in the first quarter of 2021 as sales activity decelerated across all sectors. Sectors, like discretionary and entertainment that had already been experiencing declines fell under more pressure in the quarter. Spending on necessities and household goods that had been increasing and helping to offset weakness elsewhere saw sales growth moderate. This adds up to a negative aggregate growth rate for Dublin for Q1 2021 as well as negative growth for Ireland overall.
On the positive side, it is likely that we are seeing the light at the end of the tunnel. Recent easing of restrictions in Q2 is a very welcome sign and should help boost domestic spending
Tourism spending in Dublin and Ireland did not move much in Q1 as travel restrictions continued to freeze spending. As vaccination programs proceed in key markets such as the U.S., there is optimism that spending could pick up in the second half of the year.”Michael McNamara, Global Head of SpendingPulse, MasterCard