Despite cost-of-living pressures, people are continuing to splurge on retail therapy.
Experts believe this increase in spending could be a result of people’s heightened stress about the future.
From adjusting to the pandemic, to extreme weather patterns, Australians might feel more uncertain about what the future will look like.
UWA behavioural scientist Nicole Celestine said this uncertainty was a driving factor causing Aussies to spend more money on recreational goods and activities, such as eating out or shopping online.
“When our environment presents barriers we find a way to deal with difficult emotions, even if we have to adapt.”
Dr Celestine said people often shopped to regain control and relieve stress to make themselves feel better.
The psychology of spending explains how people look to spend their money on what they believe will result in good feelings.
“Uncertain circumstances, like the pandemic, can create a short-term focus on immediate pleasure and things which promise to make us feel good in the moment since our future isn’t as clear,” she said.
This increased level of retail spending is reflected in Australian Bureau of Statistics data that revealed a record increase in sales volumes from the June quarter 2022.
This was the third consecutive quarterly rise in retail trade sales according to the ABS data. With a 1.4 per cent rise in the June quarter 2022, 1.0 per cent in the March quarter 2022 and 7.7 per cent in the December quarter 2021.
ABS head of retail statistics Ben Dorber said growth was particularly strong in cafes and restaurants, where they rose 8.5 per cent during the June quarter. This came after the easing of lockdowns across Australia.
Mr Dorber said retail was one of the largest employing sectors in Australia, so the pattern of increased spending was promising for the economy.
“These places took a hard hit during lockdowns and there’s been a real rebound in sales since restrictions ease.”
However, ABS June retail sector results also showed industry sales, such as household goods have decreased. This comes with the cost of living rising.
According to ABS data people are continuing to spend more money on things such as take away food and drink, clothing, and other recreational goods.
Mr Dorber said this increase in spending could be a positive thing for Australia’s economy as an increase in spending could lead to more jobs.
“We can see stores starting to open up employment which is driven by the increase in spending.”
Dr Celestine agreed this heightened retail expenditure can be a positive response.
She said: “If you can tie a purchase to create an adaptive healthy strategy, it can be a really positive thing.”