The Australian Bureau of Statistics detected “a change in usual” spending habits as the nation spent more on shopping despite cost of living pressures.

Retail sales in Australia experienced a resurgence, largely due to an increase in spending at department stores and on clothing and footwear.

According to the Australian Bureau of Statistics, the country's retail turnover for January rose by 1.9%, marking the largest monthly increase since November 2021. This represents a significant improvement from December's decline of 4% and monthly growth between 0.4% and 1.7% from February to November of the previous year.

The recent surge in retail activity was driven by a combination of factors, including the holiday season, sales, and a shift in consumer spending patterns, with all states and territories contributing to the increase.

“November, December and January are the most seasonal months of the year, with retail activity heavily affected by the Christmas period and January holidays,” ABS head of retail statistics Ben Dorber said.

“This has been heightened by an increase in the popularity of Black Friday sales and growing cost of living pressures combining to drive a change in usual consumer spending patterns.”

The Australian Capital Territory, Victoria, Tasmania and Western Australia notably had the greatest increase in spending in January from December.
Department stores rose the most by 8.8 per cent, followed by a 6.5 per cent hike in clothing, footwear and personal accessory retailing and a combined four per cent rise in other retail and household goods.

Cafes, restaurants and takeaway food services shattered its record for sales as it raked in $5.2 billion in profit in January 2023 which was  a 1.2 per cent increase from the previous year.

"The continued return of large-scale sporting and cultural events in January, combined with high costs reflected in prices, has boosted sales in catering services which are part of the cafes, restaurants and takeaway food services industry,” Mr Dorber said.

Australian Retailers Association CEO Paul Zahra described the latest sales data as a "strong result".

"Particularly for apparel traders and department stores who have worked hard to clear their summer inventory," Mr Zahra said.  

"There's no doubt that an impressive Boxing Day trade certainly bolstered these sales, with the shoppathon a fixture on the January calendar.  

"The sales recorded by restaurants and cafes are particularly strong – and it's clear the appetite for dining out has been boosted after the challenges of the pandemic." 

The ABS on Wednesday will release the inflation data for January. Inflation was up 7.8 per cent in the year to December 2022. 

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