MORE than two in five Brits have cancelled a summer trip this year because of the cost in move that is a “handbrake on growth” for the UK and is “bad news” for the economy.
A survey of UK consumers by ecommerce marketing platform Omnisend found that 44% of Brits have cancelled, postponed, shortened or downgraded a holiday this year because of money.
Of those struggling to pay for a holiday this year, 10.1% have been forced to cancel a trip abroad altogether.
With British holidaymakers spending an average of £53.6 billion on holidays outside of the country, that equates to a £5.4 billion hit to the travel industry.
Ahead of the school holidays, almost a quarter (24%) are taking a shorter or cheaper trip than planned, while a fifth (19%) are sticking to day trips or local outings only.
Food shopping and everyday bills are now the biggest pressure on summer travel plans, with 31% saying these costs have made a strong impact.
Four in ten Brits spending less on travel (40%) are putting the money towards their weekly shop instead, while one in five (20%) are using it for rent or mortgage payments.
Bad news for the economy
Marty Bauer, ecommerce expert at Omnisend, said: “Brits are not giving up on summer, but many are having to redefine what a summer break looks like. For a lot of households, the holiday budget no longer sits in its own separate pot. It is competing directly with the weekly food shop, rent, mortgage payments, fuel costs and debt repayments. That changes the way people make decisions. Before choosing where to go, families are having to ask whether that money is better used to keep on top of everyday bills.
“Cancelled summer plans are bad news to the travel industry and the economy. With over £5 billion being used elsewhere, travel agents are likely to notice the difference this summer.
“That being said, summer spending is not vanishing entirely. It is shifting. Consumers are being more selective, more value-conscious and more cautious about larger purchases, but they are still open to affordable treats and smaller moments that feel worthwhile. Day trips and ‘staycations’ are proving popular again this summer, giving a much-needed cash injection for many British seaside towns and museums.”
Harvey Dhillon, CEO at Zmartly, said people are being forced to pay for essentials instead.
He added: “The number that tells the real story is not the 44% who have cancelled or cut back a trip. It is where that money went: 40% to the weekly food shop, and one in five to rent or the mortgage. People are not banking the holiday money, they are moving it to cover essentials.
“A holiday is the most visible discretionary spend a household has, so it is the first to go when the gap between take-home pay and fixed bills tightens, and that gap is squeezed from both ends: the price of essentials, and frozen tax thresholds that shrink the value of every pay rise.
“We act for hundreds of small businesses, and the softening shows in their books before any survey: quieter bookings, smaller baskets, customers trading down. This is an economy-wide problem, not a household one. A cancelled holiday is a lost month for the seaside café, the B&B and the online seller whose year turns on summer. One family’s saving is another small firm’s shortfall.”
Handbrake on growth
Paul Denley, CEO at London-based Oakham Wealth Management, said cancelled holidays are a “handbrake on growth”.
He added: “Holidays are usually the first casualty when household budgets tighten – or, at the very least, they undergo a painful downgrade. A fortnight in the sun is discretionary; the mortgage and the weekly shop are not. What makes these figures so striking is that they come after inflation has supposedly been tamed.
“But prices haven’t fallen, they are simply rising more slowly, while higher taxes and housing costs have added to the squeeze on family finances. We see that caution across the economy: consumers trading down, delaying big purchases and rebuilding savings buffers rather than spending.
“That may be rational for individual households, but collectively it acts as a handbrake on growth. When even the great British getaway is being rationed to pay for the weekly shop, policymakers should take note. Sunshine, it seems, is now a luxury good.”
Anita Wright, Chartered Financial Planner at Ribble Wealth Management, said these are stark figures.
She added: “When people start cancelling holidays, they’re telling you something the official numbers won’t. A summer trip is usually the last thing families give up, not the first. So when more than two in five are cutting back, that isn’t belt tightening it’s the belt running out of holes.
“Wages haven’t kept pace with the cost of the essentials. It is no surprise that food, rent and energy, the things you can’t opt out of, have quietly eaten the money that used to pay for the things people look forward to. And yes, it shows up right across the economy.
“The first thing to disappear in a squeeze is the thing people look forward to. When feeding the family is winning the argument against a break away, the cost of living has stopped being just a headline.”
‘Downgrade economy’
Samuel Mather-Holgate, Managing Director & IFA at Swindon-based Mather and Murray Financial, said high streets, seaside towns and small businesses are affected by families cutting back on holidays.
He added: “Families are cutting back on holidays because the weekly shop, energy bills and housing costs are eating the money that used to pay for a break. A summer trip is often the first thing to go when household budgets are stretched, because you cannot postpone the rent, the mortgage or the food bill. We are seeing a broader ‘downgrade economy’ take hold- shorter breaks, cheaper accommodation, fewer meals out and more day trips close to home.
“That matters beyond the family budget, because travel, hospitality and retail all depend on discretionary spending. When households are forced to choose between a holiday and groceries, the pain does not stay at the kitchen table – it ripples through high streets, seaside towns and small businesses across the country.”
Tony Redondo, Founder at Newquay-based Cosmos Currency Exchange, said you face more barriers to travel abroad now.
He added: “Over two in five Brits are cutting summer holidays as grocery bills eat into discretionary spending. Saving on a getaway has become a defensive move, with holiday funds redirected straight into the weekly shop. Families are hit hardest: a quarter have no trips booked, and low-income parents face extra pressure once subsidised school meals end.
“Beyond cost, the EU’s new Entry/Exit System with facial scans and fingerprints at the border has triggered major queues, turning travel into an ordeal. The self-employed face their own squeeze: under Making Tax Digital, sole traders earning over £50,000 must now report quarterly, complicating cashflow just as tourist spend dries up.
“When 40% of travel-savers divert cash into groceries, it signals a shift from “experience” spending back to basic staples, bad news for apparel, home goods and leisure retail. The cutbacks are really a symptom: households managing balance sheets to absorb structural price rises.”
Wider economic danger
Nouran Moustafa, Practice Principal & IFA at Roxton Wealth, said there is a “wider economic danger” to the UK due to people cutting back on holidays.
She added: “People are not cutting back because holidays suddenly matter less, they are cutting back because everyday life is swallowing the money first. When food, rent, mortgages and household bills keep rising, the summer break becomes the easiest expense to shrink, postpone or cancel.
“I am seeing families become far more deliberate: shorter stays, driving instead of flying, choosing self-catering, staying with relatives or replacing a week away with a few local days out. The problem is that this caution does not stop at travel. When households pull back, hotels, restaurants, retailers, attractions and local businesses all feel it.
“This is the wider economic danger. People are still spending, but more of their income is being absorbed by essentials rather than circulating through the wider economy. A cancelled holiday is not just one family spending less; it is lost revenue across an entire chain of businesses.”
