Financial pressures have West Aussies sacrificing essentials

18 April 2023

The latest Bankwest Spend Trends Report has revealed the extent of the financial pressures on Western Australians, with spending plummeting across the board – including in sectors considered essential.

Bankwest’s Spend Trends report for March tracked WA customer credit and debit activity to provide insights into the community response to economic conditions, with year-on-year data showing essential sector declines.

That data showed, when comparing March 2023 to March 2022, sharp falls in customer and transaction volumes in sectors such as Food Stores/Warehouses (-21%, -18%), Pharmacies (-21%, -25%) and Utilities (-21%, -22%).

The year-on-year declines come despite Level 2 COVID health measures, which included venue and patron capacity limits, not easing until 31 March 2022, meaning that last year’s already-low spending volumes have fallen further.

The analysis also showed the number of customers transacting month-on-month was down 22 per cent, while the volume of transactions tumbled 20 per cent, with no sector in either category experiencing growth for the period.

The results indicated a significant pull-back on spending from consumers as cost-of-living and inflationary pressures combine to create a challenging financial environment, with the value of transactions proving telling.

Only six of 25 sectors declined in the value of transactions month-on-month, despite all 25 falling in customer and transaction volumes, with increases in essential sectors such as Utilities (7%), and Food Stores/Warehouses (3%).

The year-on-year data was equally telling, with the number of customers transacting growing in only three sectors – Travel Agencies (23%), Airlines (9%), and Other Transport (2%) – which was expected, given travel normalising.

Year-on-year transaction volume growth was equally predictable against the travel impacts of 2022, with Travel Agencies (46%), Other Transport (32%), Airlines (26%), Hotel/Motel (17%), and Auto Rental (6%) the only increases.

However, despite the limited growth in customer and transaction volumes, transaction values across the year grew in more than 60 per cent of sectors, a stark illustration of effects of inflation and cost-of-living pressures.

The transaction value growth was led by Hotel/Motel (53%), Electrical Appliances (37%) and Other Transport (30%).
Increasing costs forced Western Australians to pull back in essential (aforementioned) and non-essential sectors.

Non-discretionary sectors were sacrificed in the search for savings, with sharp falls year-on-year in customer and transaction volumes for the likes of Electrical Appliance retailers (-47%, -28%) and Department Stores (-35%, -32%).

Bankwest General Manager Philippa Costanzo said: “The current economic climate is having inflationary and cost-of-living pressures combining to force Western Australians to make choices on where they spend their money.

“The Spend Trends data shows us that these choices are quite significant and across the board, with the year-on-year declines, particularly in sectors that would be considered essential, suggesting money is tight for many.

“The few areas that have experienced growth in value year-on-year are relatively predictable, such as travel sectors with the normalising of that industry, and the housing market could also be contributing to Hotel/Motel increases.

“We expect challenging economic conditions to be around for some times, and I encourage any customers experiencing financial difficulty – or concerned they might in the future – to contact us as soon as possible."

Overall transaction change

  Number of customers transacting
(%)
Total volume of transactions
(%)
Total value of transactions
(%)
Month-on-Month
Feb 23-v-Mar 23
-22
-20
-1
Year-on-Year
Mar 22-v-Mar 23
-19
-14
+9
 
Number of customers transacting
(%)
Total volume of transactions
(%)
Total value of transactions
(%)
Month-on-Month
Feb 23-v-Mar 23
-22
-20
-1
Year-on-Year
Mar 22-v-Mar 23
-19
-14
+9

Focus on cost-of-living

Top sectors by difference between transaction value and volume growth from Mar 22-Mar 23
  Volume
(%)
Value
(%)
Difference
(%)
Electrical appliance
-28
+37
+65
Department stores
-32
+6
+38
Hotel/Motel
+17
+53
+36
Discount stores
-20
+13
+32
Vehicles
-14
+9
+23
 
Volume
(%)
Value
(%)
Difference
(%)
Electrical appliance
-28
+37
+65
Department stores
-32
+6
+38
Hotel/Motel
+17
+53
+36
Discount stores
-20
+13
+32
Vehicles
-14
+9
+23

Where Western Australians are spending Month-on-Month

Sectors by volume of unique customers transacting
Biggest growth in number of unique customers transacting % Smallest growth in number of unique customers transacting %
Hotel/Motel
-15
Repair shops
-25
Clothing stores
-17
Discount stores
-25
Auto rental
-18
Mail order
-24
Sporting/Toy Stores
-19
Electrical appliance
-23
Travel agencies
-19
Food Stores/Warehouses
-23
Biggest growth in number of unique customers transacting
%
Smallest growth in number of unique customers transacting
%
Hotel/Motel
-15
Repair shops
-25
Clothing stores
-17
Discount stores
-25
Auto rental
-18
Mail order
-24
Sporting/Toy Stores
-19
Electrical appliance
-23
Travel agencies
-19
Food Stores/Warehouses
-23

Where Western Australians are spending Year-on-Year

Sectors by volume of unique customers transacting
Biggest growth in number of unique customers transacting % Smallest growth in number of unique customers transacting %
Travel agencies
+23
Electrical appliance
-47
Airline
+9
Department stores
-35
Other transport
+2
Discount stores
-29
Auto rental
-5
Repair shops
-26
Recreation
-6
Hotel/Motel
-24
Biggest growth in number of unique customers transacting
%
Smallest growth in number of unique customers transacting
%
Travel agencies
+23
Electrical appliance
-47
Airline
+9
Department stores
-35
Other transport
+2
Discount stores
-29
Auto rental
-5
Repair shops
-26
Recreation
-6
Hotel/Motel
-24

Month-on-month (Feb-Mar 23) top 5 sectors by …

Biggest growth in volume % Smallest growth in volume % Biggest growth in value % Smallest growth in value %
Professional services
-12
Education
-36
Professional services
+9
Education
-18
Hotel/Motel
-13
Recreation
-30
Utilities
+7
Recreation
-11
Utilities
-16
Repair shops
-27
Discount stores
+6
Sporting/Toy Stores
-8
Clothing stores
-16
Sporting/Toy Stores
-26
Restaurants/Bars
+5
Travel agencies
-3
Hardware
-17
Repair shops
-24
Other services
+4
Repair shops
-2
Biggest growth in volume
%
Smallest growth in volume
%
Biggest growth in value
%
Smallest growth in value
%
Professional services
-12
Education
-36
Professional services
+9
Education
-18
Hotel/Motel
-13
Recreation
-30
Utilities
+7
Recreation
-11
Utilities
-16
Repair shops
-27
Discount stores
+6
Sporting/Toy Stores
-8
Clothing stores
-16
Sporting/Toy Stores
-26
Restaurants/Bars
+5
Travel agencies
-3
Hardware
-17
Repair shops
-24
Other services
+4
Repair shops
-2

Year-on-year (Mar 22-v-Mar 23) top 5 sectors by …

Biggest growth in volume % Smallest growth in volume % Biggest growth in value % Smallest growth in value %
Travel agencies
+46
Repair shops
-40
Hotel/Motel
+53
Repair shops
-19
Other transport
+32
Department stores
-32
Electrical appliance
+37
Mail order
-9
Airlines
+26
Electrical appliance
-28
Other transport
+30
Sporting/Toy Stores
-7
Hotel/Motel
+17
Interior furnishings
-26
Travel agencies
+19
Pharmacies
-4
Auto rental
+6
Pharmacies
-25
Restaurants/Bars
+16
Interior furnishings
-3
Biggest growth in volume
%
Smallest growth in volume
%
Biggest growth in value
%
Smallest growth in value
%
Travel agencies
+46
Repair shops
-40
Hotel/Motel
+53
Repair shops
-19
Other transport
+32
Department stores
-32
Electrical appliance
+37
Mail order
-9
Airlines
+26
Electrical appliance
-28
Other transport
+30
Sporting/Toy Stores
-7
Hotel/Motel
+17
Interior furnishings
-26
Travel agencies
+19
Pharmacies
-4
Auto rental
+6
Pharmacies
-25
Restaurants/Bars
+16
Interior furnishings
-3

Sector examples

Sector Examples
Airlines
Self-explanatory
Auto rental
Self-explanatory (general and commercial)
Clothing stores
Single-brand stores, as opposed to multi-brand department Store retailers
Department stores
Large department stores and chains, not including discount department stores
Discount stores
Discount department stores and budget lifestyle and homeware retailers
Electrical appliance
Whitegoods retailers, home entertainment stores, mobile and computing device outlets, computer games
Food stores/Warehouses
Includes grocery stores, as well as wholesale food distribution warehouses
Hardware
Hardware retailers and chains, landscaping specialists, home DIY retailers
Hotels/Motels
Self-explanatory
Other retail
Online marketplaces, online arms of bricks-and-mortar retailers, discount department stores, liquor stores
Other services
Courier services, public administration, newspaper subscriptions, roadside assistance companies
Other transport
Ride sharing companies, taxis, private and public paid parking
Pharmacies
Self-explanatory
Professional services
All types of insurance, waste disposal services
Quasi cash
Casino and gambling activities
Repair shops
Cobblers, tailors, electrical appliance repairs, watchmakers, mobile phone repairs
Restaurants/Bars
Self-explanatory
Service stations
Self-explanatory
Sporting/Toy stores
Non-digital game retailers, outdoor recreation stores, sporting goods, apparel and footwear outlets
Travel agencies
Self-explanatory (online and bricks-and-mortar)
Utilities
Typical utility services, streaming services
Vehicles
Automotive dealerships, automotive and car care accessory retailers, repairs and servicing
Sector
Examples
Airlines
Self-explanatory
Auto rental
Self-explanatory (general and commercial)
Clothing stores
Single-brand stores, as opposed to multi-brand department Store retailers
Department stores
Large department stores and chains, not including discount department stores
Discount stores
Discount department stores and budget lifestyle and homeware retailers
Electrical appliance
Whitegoods retailers, home entertainment stores, mobile and computing device outlets, computer games
Food stores/Warehouses
Includes grocery stores, as well as wholesale food distribution warehouses
Hardware
Hardware retailers and chains, landscaping specialists, home DIY retailers
Hotels/Motels
Self-explanatory
Other retail
Online marketplaces, online arms of bricks-and-mortar retailers, discount department stores, liquor stores
Other services
Courier services, public administration, newspaper subscriptions, roadside assistance companies
Other transport
Ride sharing companies, taxis, private and public paid parking
Pharmacies
Self-explanatory
Professional services
All types of insurance, waste disposal services
Quasi cash
Casino and gambling activities
Repair shops
Cobblers, tailors, electrical appliance repairs, watchmakers, mobile phone repairs
Restaurants/Bars
Self-explanatory
Service stations
Self-explanatory
Sporting/Toy stores
Non-digital game retailers, outdoor recreation stores, sporting goods, apparel and footwear outlets
Travel agencies
Self-explanatory (online and bricks-and-mortar)
Utilities
Typical utility services, streaming services
Vehicles
Automotive dealerships, automotive and car care accessory retailers, repairs and servicing

About Bankwest
Bankwest’s vision is to deliver brilliant customer experiences every day and our purpose is to build a brighter future for all. Bankwest provides personal and business banking solutions for customers across Australia. Our customers enjoy access to an extensive network of branches and business centres, direct and third-party distribution channels, agencies and electronic banking facilities, as well as 24-hour banking on the telephone, internet and app. Bankwest, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL/Australian credit license 234945.

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