Strong Christmas sales have camouflaged true consumer sentiments.
While retail sales for the first three weeks of December were 16 per cent higher than a year ago, as shown by the national BDO Australian Retail Index, consumers remain anxious about spending.
“The anxiety index is better but it is mostly about non-discretionary spending,” National Australia Bank chief economist Alan Oster said.
“Specifically, changes in spending behaviour continue to be dominated by ‘essentials’ such as utilities, paying off debt, transport and medical services.
“What does this translate to for retail sales and consumption? Things are not good.”
NAB’s Consumer Anxiety Index, released on Tuesday, fell for the second straight quarter with lower levels of concern reported across all retail categories.
The index fell to 60.1 points in the quarter to December 31 compared with 62.3 points in the quarter to September 30.
The survey also found that people earning less than $35,000 a year, women over 50 and labourers were the most anxious.
“Women above 50 are worried about not having enough to retire, a common theme,” Mr Oster said.
“Widows have, for ages, been the most relaxed and less stressed . As my wife says, ‘got rid of husbands, got money, life is good’.”
Mr Oster said the cost of living and government policy continued to be the biggest causes of anxiety for Australians.
Job security causes the least stress, despite rising unemployment and a marked slowing in the domestic economy.
“And labourers are anxious because as the economy slows, the labourer often is the first to go during a retrenchment process,” Mr Oster said.
While the survey indicates Australians are feeling better about the economy, their actions are not reflecting their sentiments.
“For example, the online index last month was not pleasant. Normally, November has a big month . . . and online sales are normally up about 16 per cent; this time, it is 7 per cent,” he said.
“The seasonal adjusted index means online sales growth is negative.”
Mr Oster said Australians had money – saving well since the global financial crisis from 2008 to 2009 – but they were not willing to spend it.
Westpac Bank also projected a bleak retail outlook when it released the Westpac-Melbourne Institute survey of consumer sentiment on December 10.
The bank’s chief economist, Bill Evans, described the 5.7 per cent fall in the consumer sentiment index – from 96.6 in November to 91.1 in December – as “a very disturbing result”.
Westpac’s survey showed the economy had been limping at a 1.6 per cent annualised growth pace for the past six months.