Consumers plan to cut their spending over the next year on everything from supermarket food to short breaks and eating out as they struggle to cope with the growing squeeze on their income.

In a bleak illustration of the challenge facing the high street, a survey indicates that people believe they have no choice but to tighten the purse strings, given spiralling energy bills and the deepening gloom in the housing market. Pricewaterhouse-Coopers (PwC) found that 43 per cent of consumers expected to cut back on dining out, 37 per cent would spend less on electronic goods and 33 per cent would limit clothing purchases.

A third said that they might switch to a cheaper supermarket and 30 per cent indicated that they might spend less on their annual holiday.

Olivia Gillan, a PwC retail partner, said: “People are getting more and more nervous, and the pace is accelerating. For retailers and leisure operators, it’s going to be a survival of the fittest.” The PwC survey is the latest in a series of grim forecasts for the economy and comes only two weeks after official figures recorded the biggest fall in retail sales for 20 years.

A separate Nationwide report will claim today that consumer confidence has fallen to a record low amid growing concerns over job security. Nationwide’s consumer confidence index is 46 per cent below the levels of a year ago, before the credit crunch began.

Lord Harris of Peckham, the founder and chief executive of Carpetright, said yesterday that it was clear that consumers were putting off purchases as the group reported a 15.4 per cent fall in like-for-like sales for the 13 weeks to August 2. He said: “It’s not only in the carpet industry, it’s in furniture, curtains, bedding – everything’s gone quiet in that area. It’s bloody tough.”

The PwC survey suggested that 60 per cent of homeowners believed that they would be worse off in a year’s time – up from 37 per cent in April. It added that the low-paid and elderly were the most pessimistic, with people aged 18 to 24 the most optimistic.

Ms Gillan said that supermarkets would be hit by the slowing economy, as discount chains such as Aldi, Lidl and Netto continued to increase their market share. Aldi said recently that its sales were up by 30 per cent year-on-year.

“The impact of the early 1990s recession on the grocery sector was very limited,” Ms Gillan said. “However, since then grocery purchasing has arguably become more discretionary as people have treated themselves by trading up to supermarkets’ ‘finest’ or ‘best’ ranges.

“As a result, this time round the sector could be hit harder if consumers rein in their spend by cutting out unnecessary luxuries and trade down to cheaper rivals.”

PwC’s survey shows that consumers have started to cut back to cope with the growing pressure on household budgets, with 35 per cent shopping less often since the start of the year. About 28 per cent have delayed decorating the home, 25 per cent have bought more secondhand goods and 24 per cent have stayed in to watch a DVD rather than go to the cinema. Only 15 per cent have made no extra effort to save money.

Ms Gillan said: “Consumers are already starting to change their behaviour and, as consumer spending tightens, the proportion spent on discretionary categories within the leisure and retail sectors is likely to decline.”

Dozens of retailers have collapsed into administration since the start of the year, including Dolcis, the shoe store chain, and, most recently, Wrapit, the online wedding gift service. It is expected that more than 100,000 retail jobs will be lost by the end of next year. Pubs are closing at their fastest rate as the consumer downturn and the smoking ban have reduced the numbers of people spending an evening at their local.

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