Record post-lockdown rise for business travel in early August
Business fuel consumption peaked in mid-August, despite the summer holidays, with all sectors of the UK economy seeing highest weekly growth spikes during the last month.
The analysis, by Allstar Business Solutions, builds on ONS data revealing that GDP grew by 6.6% in July and suggests that this positive economic trend continued across the board until mid-August, when average fuel consumption peaked in the week commencing 17 August at 125% above the lockdown baseline.
These findings, part of Allstar’s latest Business Barometer Monthly Snapshot, which tracks business mileage and credit card data as an economic indicator of recovery by sector.
The fuel card data, covering more than 50,000 companies, shows that while fuel consumption for August overall dropped by 4.4% compared to July 2020, this was largely due to the August Bank Holiday, as well as increased domestic and foreign holidays as some coronavirus regulations were eased. And the decline was lower than the usual year-on-year fall in fuel use for the holiday month (2019 saw a 9% fall from July to August). The long-term trajectory also remains upwards, with businesses travelling 1.06 billion more miles in August than June.
Rather positively, the w/c 17 August was, on average, the most active for businesses on the road since the start of lockdown. Arts, entertainment and recreation witnessed a 407% increase in mileage – just days after government lockdown restrictions were eased for some leisure businesses. Manufacturing (161%), construction (141%) and financial services (106%) also saw their most significant post-lockdown growth during that week.
In comparison, hospitality and catering saw its largest weekly growth (211%) during the w/c 24 August, potentially due to people becoming increasingly comfortable with returning to restaurants towards the end of the ‘Eat Out to Help Out’ scheme. The same is true of wholesale and retail businesses (161%), while education saw its largest spike in business travel (258%) during the week commencing 31 August, likely due to preparations for students returning to the classroom.
In line with the fuel consumption statistics, Allstar’s data on weekly business credit card usage also peaked in mid-August. The month saw an overall decrease of 6.7% compared to July, due to the Bank Holiday Weekend, but remained 7% higher than business expenditure in June. The most significant monthly spend increases were seen by customers in the social and personal services sector (22%), most likely due to the further lifting COVID-19 restrictions on such businesses. When reviewing where business expense spending is occurring, there was a 200% increase, month on month, on air travel; a 27% increase in restaurants and 13% increase in hotels.
Paul Holland, MD of UK Fuel at Allstar parent firm FleetCor, said: “Although at first glance, seeing a drop in business fuel consumption in August may suggest a slowdown, this followed a sharp rise in June and July.
“It’s encouraging to see all sectors witnessing their highest weekly growth spikes during the last month; highlighting a continued hunger for businesses to get back on the road as the recovery continues. While the number of people on holiday clearly had a downward impact towards the end of the month, it doesn’t appear this will have a long-lasting effect.”
He continued: “Early indicators seem to suggest a stronger start to September as children return to school.”
To download Allstar’s full report, visit https://www.allstarcard.co.uk/news-insights/business/barometer-august-snapshot/