Australians batten down the hatches, spend less during isolation
01 Jun 2020
Forty-nine per cent of Australians are spending less money on non-essential items during the coronavirus pandemic, with clothing (46%), accessories (43%), coffee (42%) and takeaway food (38%) being the biggest hit.
MYOB Economist Jon Manning said with economic uncertainty, it’s common for consumers to be more frugal with their disposable income.
“Respondents told us they are spending either much less, or about the same, on non-essential purchases. The exception is groceries, where 26% of consumers are spending more, compared to 14% who are spending less. This type of spending appears to be going through significant fluctuation when considering just last month, the ABS reported grocery purchases were declining between 15% and 24%*.
While Australians are tightening their belts, 23% of respondents say they are buying more ‘little treats’ than usual, with 65% typically spending between $5 and $50 on something small.
“Consumers are definitely being more conscious with their spending overall, however in these strange times we all need a small splurge. Many Aussies are making smaller non-essential purchases, usually for themselves, with half of them doing so weekly,” Mr. Manning added.
With people spending so much time at home, these treats are most likely to be takeaway food (36%), alcohol (33%) and premium branded groceries (30%).
“In positive news for local businesses, 85% of respondents who are buying themselves small treats are buying from local businesses and the vast majority will continue to support at least some of these local businesses when coronavirus restrictions ease,” Mr. Manning said.
“We expect consumers to start spending more again now that restrictions are lifting. The shape of the recovery will differ from industry to industry, but for industries such as hospitality and retail we hope to see a quick bounce-back, or what is termed as ‘V-shaped’ recovery; wonderful news for many small business owners,” Mr. Manning said.
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* ABS April 2020