Retail sales over the year-ended June 2018 rose an anaemic 2.9% to be just 0.8% ahead of headline CPI over the same period. Although there is just the hint of spring in the latest data, the fact is that winter arrived some time back for Australian retailers, with many unlikely to survive.
They may not be as low as their worst, as the chart below shows, but retail sales are barely above their floor, having grown just 0.4% in each of the last two months.
To go straight to the dashboard and take a closer look at the data, click here.
Commentators are near unanimous that for some retail sectors – fashion is an obvious example – e-commerce and direct-to-home deliveries have been a chill wind, keeping buyers away and ripping cash from the hands of the traditional retailers. It is by no means clear that all the relevant e-commerce transactions are being reported as ‘retail’.
In June 2018, sectors of interest to the forestry and wood products industry delivered mixed results. Retail sales of Furniture and Flooring were flat (0.0%), but for the year-ended June, were down 2.4%. Hardware Building & Garden Suppliers were down 0.1% for the month, but over the full year, were up 1.0%. Notably, retail sales connected to the housing sector were lower, and we cannot help wondering if the higher prices being paid by new home owners might not be feeding into this data.
After all, if you have to pay that little bit more in a deposit and a bit more in a mortgage each week or month, that might give you a bit less cash for carpets, tables, chairs, plants and pergolas.
The chart below shows the details.
To go straight to the dashboard and take a closer look at the data, click here.
Keeping in mind the softness in wages and the prevalence of under-employment of labour in the Australian economy that is described elsewhere in this edition of Stats Count, it is little wonder that retail sales have confronted a bleak winter.
To borrow from a popular pay-to-view television program: for retailers, winter is coming. Sadly for many, the winter seems likely to be too harsh, for too long.
