The 2% cut in VAT and the ‘Stay and Spend’ measures in the new stimulus package will benefit the hospitality and retail sectors, according to Deloitte Ireland, especially with Irish consumers as the sixth most confident across Europe.

The consultancy firm’s State of the Consumer tracker shows consumer confidence holding steady into July, with Ireland now in second place in Europe for confidence in visiting stores in person.

The bi-weekly survey shows that 60% of Irish consumers say that they want to make purchases in-store, up from 58%. Confidence in visiting physical stores is up a further 5%, with 61% of consumers now feeling safe to do so, putting Ireland second in Europe for this, just a point behind the Netherlands.

Partner Daniel Murray (pictured) said: “Only 20% of Irish consumers are actively seeking travel deals, which is consistent with the previous tracker. With the intent to spend on travel plateaued, the Stay and Spend incentive, combined with an increase in confidence in hotel accommodation (38% as against 30%) may drive an increase in staycations in Ireland during the off season.

“Perhaps most notable are significant rises in confidence in visiting restaurants – now at 38% – and in engaging in one-to-one services, with more than half now feeling safe to visit a hairdresser, barber or beautician. 

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“The steady increase in consumers feeling safe to make in-store purchases is a testament to the work done by retailers across the country in preparing their premises for reopening and, in some cases such as grocery and pharmacy, adapting their stores while remaining open during the initial phase of lockdown restrictions.”

Nonetheless, concerns over physical wellbeing, personal finances and job security remain and are slightly higher than in the previous survey, he added, and businesses should “strike a delicate balance in attempting to rebuild what has been lost to the crisis, while also ensuring that consumers’ safety is never compromised”.

This unease lies behind the continued reluctance to make large purchases, with 37% planning to delay such spending (down 4%), pretty much in line with the global average of 39%.

Only 20% of consumers were actively seeking travel deals, indicating travel spend will plateau around that figure. Confidence in air travel fell one point from 20% to 19%/

People do plan to travel more widely in Ireland, and within their locality, with intended spend on fuel up by two points. Reliance on personal vehicles is likely to persist, with 64% of consumers planning to limit their use of public transport over the next three months, consistent with the previous result. 

And 52% of Irish consumers now report that they are planning to keep their current vehicle longer than originally expected (down from 58%), while 20% say they would consider buying a vehicle online, up from 15%.