£4 billion Brexit stockpiling claim based on flawed survey

£4 billion Brexit stockpiling claim based on flawed survey

Original Source

“Britons have spent £4bn stockpiling goods in case of no-deal Brexit”

The Guardian, 12 August 2019

On Monday, a number of media outlets reported that Britons have spent £4 billion on stockpiling goods in case of a no deal Brexit.

But this is almost certainly an exaggeration. The survey it’s based on is not representative of the UK as a whole, and likely overestimates the amount that has been stockpiled. Consumer spending data shows no evidence of people stockpiling to this degree. We can’t definitively say this amount of stockpiling hasn’t occurred, but there are very strong reasons to be sceptical.

Where does the £4 billion figure come from?

The finding comes from a survey conducted by the research company Consumer Intelligence, on behalf of the finance provider Premium Credit.

The press release says Consumer Intelligence surveyed 1,052 consumers in the UK who are currently in employment, and found that 20% had stockpiled goods in preparation for Brexit. (It didn’t specify in preparation for a no deal Brexit).

It calculated that this meant around ten million Britons have stockpiled for Brexit, based on the total adult population of the UK being just over 52 million.

The survey also found that, among those who had stockpiled, the average amount stockpiled was £380. They multiplied this figure by the roughly ten million people they estimated to have stockpiled across the country, to come up with the £4 billion figure.

There are two problems with this calculation.

The £4 billion figure is likely too high

The first problem is that, in extrapolating the survey findings to work out the total amount stockpiled the general population, Consumer Intelligence used the total number of UK adults rather than the total number of households. In doing this, it’s likely that Consumer Intelligence overestimated the amount Britons are stockpiling.

That’s because there is a strong likelihood that people responded to the survey on behalf of their household, rather than themselves as an individual.

To illustrate this, imagine you live with a partner and together you’ve stockpiled £400 worth of food. If a survey asks you how much you’ve stockpiled, you’d probably say £400, rather than working out your individual share of £200.

It seems likely that at least some—and probably most— respondents would report a household figure rather than their individual sum.

So Consumer Intelligence’s data is likely to more accurately represent the amount the average household had stockpiled, rather than the average individual. If it does indeed reflect household stockpiling, it would have been more appropriate to use the total number of households to extrapolate the findings to the national level, rather than the total number of UK adults.

Overall, there are around 28 million households in the UK. We know that Consumer Intelligence’s extrapolation is based off the figure of 52 million adults.

So if even a minority of respondents reported a household figure rather than an individual figure, the extrapolation could have considerably overestimated the total amount stockpiled in the country.

We cannot know for certain if this has happened, as we haven’t seen the original survey results. But based on what we’ve seen of the methodology, and the fact that respondents were asked ‘how much have you spent on stockpiling’, it seems likely that this problem has affected the results.

The survey is not representative of the UK as a whole

The second problem is that the data isn’t representative of the country as a whole.

A survey is representative of the people it surveys: which in this case is only people/households in employment—not those who are unemployed or retired.

This means the survey results can only accurately reflect the stockpiling habits of the households/people in employment in the UK, which excludes a significant chunk of people.

It’s reasonable to expect that the stockpiling habits of unemployed and retired people might differ to those of employed people. Regardless, the survey isn’t able to tell us whether or not it’s the case. That means it’s incorrect to claim that the results represent the amount stockpiled by the UK as a whole.

Other evidence suggests £4 billion is too high

If such a high level of stockpiling were occurring, you’d expect that to show up in consumer spending data.

We asked the British Retail Consortium, which compiles a monthly measure of UK retail sales, whether it had seen any evidence of people stockpiling in preparation for Brexit.

Andrew Opie, Director of Food & Sustainability at the British Retail Consortium, said:

“We’re not seeing evidence of individual stockpiling in sales and there’s no need for consumers to do so. Retailers have increased stocks of longer life products we typically buy to cope with any disruption. The biggest problem in a no deal Brexit is fresh fruit and vegetables where supplies are likely to be disrupted and it’s impractical for anyone to stockpile.”

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