Consumers continue to spend up big, with retail figures showing $3.1 billion was spent on retail in April 2021, an increase of 1.1 per cent compared to the previous month and up 25 per cent compared to the same time last year, according to the Australian Bureau of Statistics (ABS).
National Retail Association (NRA) CEO Dominique Lamb says the ABS data demonstrates how crucial the retail sector is to Australia’s economic recovery.
“Retail sales boomed nationwide in April, with the Australian economy now bigger than it was before the bushfires and Covid double-whammy,” Lamb says.
“April was the first month after the expiration of JobKeeper and the Coronavirus supplement, so the strong consumer spending levels are cause for optimism.
“Retail remains absolutely crucial to Australia charting a successful recovery between now and when the pandemic finally ends. If consumers are spending money at the shops, it’s a good indicator that the economy is ticking along nicely.”
Indeed, when compared to April 2019, retail sales are up 13.6 per cent according to the ABS.
“Retail sales are well up on pre-pandemic levels, which is an encouraging sign for how the industry is performing with buoyant levels of spending across the different categories of retail,” says Australian Retailers Association (ARA) CEO Paul Zahra.
“With people not able to travel overseas, more money is being spent on goods and services in Australia which is a key driver of the buoyant figures we’ve seen today,” he says.
Given Australia’s economy essentially grinded to a halt in April 2020 when Covid hit, a comparison to April 2019 provides a more accurate reflection of spending habits.
“When comparing April 2021 to April 2019, spending on food retailing is up 10 per cent, household goods is up 24 per cent, clothing footwear and personal accessories is up 18.8 per cent, cafes, restaurants and takeaways are up 6.1 per cent and department stores are up 7.6 per cent.”
NRA’s Lamb did warn, however, that the current situation in Victoria demonstrates that challenges remain.
“The extended Victorian lockdown has thousands of jobs hanging in the balance. If similar restrictions are emulated in other states then it would put a major handbrake on Australia’s Covid-recovery.
“Governments at all levels still need to be prepared to offer assistance in the event of prolonged lockdowns. The last thing we want to do is hamper Australia’s strong revival from the country’s first recession in 30 years.”
Indeed, the latest outbreak in Victoria will put a handbrake on spending and is likely to create over $2 billion in terms of lost retail trade, adds Zahra.
“CBD retailers, particularly small businesses, along with travel retailers are an ongoing concern. They continue to suffer through the absence of international students, tourists and city office workers who are spending more time working from home.
“While retail is helping to drive Australia’s economic recovery, the virus is an ongoing threat and confidence levels and spending can change at the drop of the hat when new cases emerge in the community,” he says.
