According to data released today by the Australian Bureau of Statistics (ABS), retail sales volumes in Australia declined 0.5% in the June quarter of 2023, the third consecutive quarterly fall.
It comes after a 0.8% fall in the March quarter of 2023 and a 0.4% drop in the December quarter of 2022.
According to Ben Dorber, ABS’s head of retail statistics, the drop in retail sales volumes demonstrates the extent to which consumers have cut back on spending in response to cost-of-living challenges.
“It’s the first time since 2008 that retail sales volumes have recorded three consecutive quarterly falls”, he said.
”Retail sales volumes are down 1.4% compared to the June quarter last year. Outside of the pandemic period, this is the first time since 1991 that sales volumes have fallen compared to the previous year.”
Source: ABS
Over the June quarter, retail sales volumes fell for both food-related businesses.
Food retailing (-0.7%) fell for the second time in a row and is down 0.2% year on year. For the first time since the COVID-19 Delta lockdowns in September 2021, sales of cafes, restaurants, and takeaway food services (-0.1%) dropped.
Retail sales volumes in household products retailing (-1.5%) and department stores (-1.4%) were similarly lower. Other retail sales volumes remained basically stable (0.0%).
“The widespread fall in sales volumes reflects what retailers have been telling us about consumers focusing on essentials, buying less or switching to cheaper brands”, Ben Dorber said.
Source: ABS
The next chart from Alex Joiner plots Australia’s nominal versus real retail sales:
Source: Alex Joiner (IFM Investors)
Alex Joiner also shows that retail sales volumes have fallen across the developed world:
Source: Alex Joiner (IFM Investors)
With Australia’s population growing by around 2%, real per capita retail sales have obviously fallen sharply.
The retail recession has well and truly arrived.
