The Australian Bureau of Statistics (ABS) today released its sixth Household Impacts of COVID-19 Survey, which suggests that spending on eating out and recreational activities is expect to bounce back as restrictions ease. However, spending on household furnishings and clothing and footwear are not expected to bounce back:
“Many Australians reported decreased spending on eating out (87 per cent), child care fees (85 per cent), recreation or leisure (79 per cent), public transport (73 per cent) and personal care (64 per cent).
“Of these people, a majority expected to increase their spending on recreational activities (74 per cent), eating out (74 per cent), private transport (73 per cent), personal care (70 per cent), childcare (66 per cent) and public transport (55 per cent).
“On the other hand, the majority of Australians who had reduced expenditure on household furnishings (72 per cent) and clothing and footwear (52 per cent) expected to continue to spend lower amounts on these items as COVID-19 restrictions ease.”
Welfare payments like JobKeeper and the expanded JobSeeker have also prevented household incomes from tanking:
Two-thirds of Australians (66%) reported their household finances remained unchanged in the four weeks to mid-June.
Nearly one in five Australians (19%) reported their household finances had worsened due to COVID-19 in the four weeks to mid-June.
Almost all Australians (94%) aged 18 years and over reported their household expects to be able pay bills received in the next three months.
The Coronavirus Supplement and the JobKeeper Payment were most commonly used to pay household bills by those receiving the stimulus payments.
Of the Australians receiving the JobKeeper Payment, approximately half (48%*) were receiving less income than their usual pay, one third (33%*) were receiving about the same and one in five (20%*) were receiving more…
The survey asked people if their household finances in the last four weeks had improved, remained the same or worsened due to COVID-19. Two-thirds of Australians (66%) reported their household finances remained unchanged, one in five (19%) felt they had worsened and 16% felt they had improved.
Persons aged 18-64 were more likely than persons aged 65 and over to report that their household finances had worsened due to COVID-19 over the four-week period to mid-June (21% compared with 12%).
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The real test will come in October if emergency income support measures and mortgage repayment freezes are tapered too heavily.
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
