Holidaymakers display no ?signs of increasing spending, with the First Rate Holiday Confidence Index reporting “clear evidence that consumers are tightening their belts”.
The Winter 2015 Confidence Index, published this week, reports year-on-year falls across three holiday-spending measures – the cost of booking, the amount of money consumers plan to take abroad and their spending in destination, with two point declines in each.
First Rate suggests this confirms “holidaymakers are restricting their budgets”, although two of the three indices are one point higher than in the summer.
More than half of those planning to travel overseas plan to spend no more on booking than in the past year, while 60% said they would not spend more in destination.
The results are disappointing in light of recent figures showing average wages rising, while UK inflation was flat in September.
The report on the index also identifies “lingering doubts” about the extent of the recovery in the UK economy and household finances, with a four-point fall to 29% in adults confident of further improvement in the economy. It reports a one-point drop to 23% in those expecting their personal finances to improve.
More positively, two out of five respondents (40%) felt their jobs to be secure over the coming year and only 17% insecure.
At the same time, concern about the impact of rising interest rates has fallen. First Rate found just 16% of respondents felt a rise in rates would adversely affect their holiday plans, against 24% a year ago.
Alistair Rennie, head of strategy and innovation at First Rate Exchange Services, said: “Travel firms would obviously like to see the amount spent on bookings moving upwards. Disappointingly, there is nothing to suggest this is happening. Commitment-free 25 to 34-year-olds are the exception.”
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