Household spending in hotels, cafes and restaurants increased by 15.6% in February 2022 – compared with February 2021 –
according to new figures released by the Australian Bureau of Statistics (ABS). However, alcohol spending was down more than 10%.
Jacqui Vitas, head of Macroeconomic statistics at the ABS, said it was the third largest rise in household spending after clothing and footwear (20.2%) and recreation and culture (17.8%). Overall, household spending increased by 7.7%.
“Household spending increased in seven of the nine spending categories in February 2022, compared to February 2021. The only categories with decreased spending over the same period were on alcoholic beverages and tobacco (-10.3%) and miscellaneous goods and services (-0.8%).
“Fewer COVID-19 cases in February, alongside the further easing of restrictions over the month saw increased spending in recreation, hospitality and retail venues,” Vitas said.
All states and territories recorded increases in household spending in February 2022, compared with February 2021. Victoria (13.9%) and Western Australia (12.1%) saw the strongest increases in spending through the year. The Northern Territory recorded the weakest rise (0.6%), as the territory recovered from spending falls caused by COVID-19 lockouts and mandates in January 2022.
When comparing February 2022 to pre-pandemic January 2020 estimates, total household spending increased 5.6% in current price, calendar adjusted terms.
Consumers rein in alcohol spending
The findings follow the latest EY Future Consumer Index, a quarterly global survey of 18,000 consumers, conducted in February 2022, which found that the rising cost of goods and services is impacting 52% of global respondents’ ability to purchase goods and is affecting alcohol sales.
Driven largely by the inflationary impact on prices and the anticipation of new COVID-19 variants, the survey shows that consumers will continue to rein in their consumption, trade down to cheaper alternatives, and purchase fewer non-essentials. Around 30% of respondents are spending less on alcohol.
The survey also showed that consumers are looking for experiences more than ever before, as they make up for lost time and look for escapism from the pressures of the post-COVID-19 world, with 45% saying they plan to live more in the moment.
Kristina Rogers, EY Global Consumer Leader, said: “Customers are becoming harder to reach and the power is shifting from the brand to the consumer. Consumers originally turned from buying things to spending on experiences out of necessity, but now they see it as an active choice. The types of experiences that will appeal most to consumers are easy to access and require minimal time investment. Companies must look seriously at how they can bring more engaging and immersive experiences to the customer, both digitally and in physical stores, as customer demands shift from ‘having’ to ‘doing’, whether it’s through personalised, in-store consultations or personalized branded skins in the metaverse.”