Conventional wisdom has continued to hold a bearish view of the domestic UK economy for some time now. 

We have all heard about the bankruptcies on the UK High Street including Toys R Us and Maplin. We have also heard of the difficulties of a host of bricks-and-mortar retailers including Mothercare (LON:MTC), and more recently Dixons Carphone (LON:DC.) . 

Nevertheless, there are signs of improvement in the outlook for UK households, and by extension, for UK retailing...

In the chart below, the white line representing consumer confidence shows quite clearly that confidence bottomed out at the end of 2017, and has been on a rising trend since then. The orange line demonstrates that the UK employment ratio (the proportion of the age 16+ population that is working) continues to rise, hitting a new all-time high of 61.1%!

1. UK consumer confidence is improving, UK employment still going up

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At the same time, we can also see that the UK non-food retailing sector as a whole has been bottoming out over the last few months, trading sideways since the mid-2016 Brexit vote. 

2. UK retail sector no longer falling...

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In particular, there have been impressive recoveries/growth in some of the better-run UK retailers such as Next (LON:NXT), WH Smith (LON:SMWH) and B&M European Value Retail SA (LON:BME) of late. 

3. Decent performance since 2017 from Next, WH Smith and B&M

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Perhaps most surprising of all is the performance of Dixons Carphone (LON:DC.) Despite a profit warning 2 days ago on May 30 and a host of subsequent downgrades from brokers, the Dixons share price seems to be remarkably resilient, rallying over 20p from the intraday low. 

There is clearly value in the UK non-food retail sector right now, with attractive dividend yields on offer from Next, Marks & Spencer and Dixons to name but three. It is still an out-of-favour sector in general among institutional investors (frankly, the whole UK stock market remains out of favour among…

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