The Executive Director of the Australian Retailers’ Association, Russell Zimmerman, said May trade figures released today by the Australian Bureau of Statistics, showing reasonable annual growth of 2.44% with Queensland (4.75%) and Victoria (4.21%) posting healthy year-on-year increases, shone a “post-election ray of sunshine” that he hoped would continue in coming months.
Reflecting on month-on-month figures that showed growth in May of 0.1% compared to a small contraction in April, Mr Zimmerman said the numbers supported the ARA’s contention that the recent federal election had temporarily suppressed consumer spending in some categories.
“We know elections slow retail sales, and it seems people are a bit more confident now the federal election is over. These figures shine a small post-election ray of sunshine across the retail sector,” Mr Zimmerman said.
Mr Zimmerman noted almost 60% of May was still covered by the election campaign, and that the impact of the election on consumer retail spending would not wash through until the June figures are available next month.
“Whilst household goods declined again in May, the decrease was softer, with hardware and building bouncing back; if we look at the fall in electrical goods, this is likely due to the late winter and lower consequent sales of heaters, radiators and electric blankets,” Mr Zimmerman said.
“On the other hand, cafes and restaurants experienced strong sales growth in May, which suggests people are a little more confident, and rewarding themselves by going out to dinner,” Mr Zimmerman said.
We’ve seen department stores come off a bit of a high in year-on-year terms from April, which suggests a lot of discounting in a part of the retail sector we know is tough, which was probably underlined by the announcement Debenhams is going to quit its entry into the Australian market,” Mr Zimmerman said.
Mr Zimmerman said a softer result in the clothing, footwear and personal accessories category compared to April, where year-on-year growth of 1.15% was recorded in May, probably mirrored the effects of a delayed winter experienced in the electrical goods category and an unseasonably warm start to the season.
“We’re pleased to see the increase in spending on pharmaceutical goods in May, although we note this is likely to be partly driven by the upswing in people buying treatments for coughs and colds that have still circulated despite the warmer weather,” Mr Zimmerman said.
“It is a concern to see ongoing steep declines in sales of newspapers and books (-7.22) continue into a 22nd consecutive month of falling sales, but this is likely to most affect printed papers and magazines as more people move online to access these products,” Mr Zimmerman said.
Across the country, Queensland (4.75%), Victoria (4.21%), South Australia (2.88%), Australian Capital Territory (3.31%),Tasmania (0.61%), New South Wales (0.48%), Western Australia (0.43%), recorded growth, while the Northern Territory (-4.28%) recorded negative growth in April.
Mr Zimmerman noted the protracted decline in retail sales figures for the Northern Territory as a cause for particular concern, and strongly urged the Territory government to undertake all measures within its power to stimulate consumer confidence and retail activity in the top end.
Monthly Retail Growth (April 2019 – May 2019 seasonally adjusted)
Food retailing (-0.42%), Clothing, footwear and personal accessory retailing (-0.38%), Other retailing (0.61%), Cafés, restaurants and takeaway food services (0.65%), Department stores (-0.27%) and Household goods retailing (0.55%).
Australian Capital Territory (0.77%), Victoria (0.70%), South Australia (0.69%), Northern Territory (0.62%), New South Wales (-0.23%), Western Australia (-0.35%), Queensland (-0.36%), Tasmania (-0.51%).
Total month-on-month sales (0.05%).
Year-on-Year Retail Growth (May 2018 – May 2019 seasonally adjusted)
Food retailing (3.33%), Clothing, footwear and personal accessory retailing (1.15%), Other retailing (4.35%), Cafés, restaurants and takeaway food services (4.22%), Department stores (-1.37%) and Household goods retailing (-0.76%).
Queensland (4.75%), Victoria (4.21%), Australian Capital Territory (3.31%), South Australia (2.88%), Tasmania (0.61%), New South Wales (0.48%), Western Australia (0.43%), and Northern Territory (-4.28%).
Total year-on-year sales (2.44%).