Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a regular economic update, and we think you’ll find it useful in these strange times.

New data released today by illion shows Australia’s economic recovery is starting to emerge, but with Sydney taking a clear lead over Melbourne.

Sydney’s latte line spends up

There has been a dramatic shift in spending habits from the beginning of the COVID-19 pandemic (April) to October.

In April, Sydney’s share of spending in lower income Local Government Areas bolstered the economy, with areas such as Penrith increasing spending by 2% and Blacktown increasing spending by 8%.

Wealthier suburbs, such as Woollahra, saw the largest drop however, with discretionary spend down to 80% below pre-covid levels. Mosman dropped to 77% below pre-pandemic levels.

In the most recent period of LGA data in October, a shift has happened: Sydney’s ‘latte line’, higher income LGAs, have now increased their spending and are driving the recovery.

Mosman’s spending regained its mojo in October, with spending 7% above normal levels. Woollahra’s spending dropped 81% in April, and is now at 18% below normal levels.

Burwood’s spending has also increased dramatically – 59% below normal levels in April and in October soaring to 55% above normal levels.

It’s a different story in Victoria

While there has been a dramatic shift in spending habits in Sydney from April to October, the difference is less pronounced in Melbourne, as Victoria only emerged from their second lockdown at the end of October.

In the wealthier suburbs in Bayside, spending was down 12% in April, while the City of Stonnington saw a much higher 63% decrease, evidencing how higher income earners tightened the purse strings during COVID. In Bayside, spending is still 10% below normal, with Stonnington currently 61% below the benchmark from November 2019.

For the inner-north City of Yarra, the heart of Melbourne’s cultural scene, (suburbs like Fitzroy and Collingwood), spending dropped in April to 77% below normal, but has bounced back remarkably to 4% above November.

Similarly, in the City of Melbourne, spending dropped 68% in April from the November 2019 baseline, but has recovered to 23% below normal. The pattern continues in Moreland (Brunswick and East Brunswick), with spending dropping 56% in April, but recovering to sit on 21% below normal.

It’s a very different story along the bay and in Melbourne’s leafy east, however, which appear to be still largely struggling from the effects of COVID. Spending was down 2% in April and is now 49% down.

Monash was down 46% below normal in April and remains 62% down. Spending in Kingston was 8% below normal in April and is now 45% below normal. Port Phillip spending was down 41% in April and that trend has continued, with that LGA now 68% down.

Looking beyond Melbourne to the north west, the LGAs of Macedon Ranges and Moorabool recorded drops in spending of 61% and 45% in April, but have both recovered remarkably to be on 9% and 2% above normal.

So, what can we learn from these spending patterns?

The spending pattern over the last year is economics 101. There are clear spend trends across suburbs in Sydney and Melbourne. At the peak of the crisis, the most affluent suburbs tightened their belts, but other typically lower to middle-income suburbs emerged as the clear leaders in keeping the economy and our communities going.

We can also see how impactful stimulus payments were in supporting lower income households. Now, with our borders closed, higher income people have realised that they have managed to save a significant amount, they’re not going on their overseas holidays and they are ready to spend up.

As Victorians emerge from their harsh lockdown just in time for the holidays, we can expect to see a lot more money flowing through the economy now too, which is good news for everyone.

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with regular insights on the current state of play. Want to know more? Further data is available here.

Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a fortnightly economic update, and we think you’ll find it useful in these strange times.

New data released today shows Australia’s economic recovery is starting to emerge.

The last fortnight of spending has been the first time Australia has hit pre-pandemic levels of spending since July.

This is also the first time since the pandemic began that high income earners are spending at pre-COVID levels – both in discretionary and essential spending.

Food delivery remains the strongest category across Australia in terms of growth and resilience – and it could be the new normal.

Last week’s results are a great sign that the tapering of the stimulus and supplement measures are not having a disastrous effect on the economy.

Australians should be buoyed by the fact that spending is now back to pre-COVID levels across both essential and discretionary spending.

It’s pleasing to see confidence returning – and especially that the higher income earners are opening their purse strings again.

Aussies love their MasterChef but are very obviously leaving the cooking to someone else.

NSW winners and losers

Winners:

• Food Delivery 356% above pre-pandemic levels
• Online Retail 139% above pre-pandemic levels
• Online Gambling 73% above pre-pandemic levels
• Fast Food Restaurants 45% above pre-pandemic levels

Losers:

• Travel 73% below pre-pandemic levels
• Entertainment (Movies, Arcades, Bowling etc.), 62% below pre-pandemic levels
• Public transport 46% below pre-pandemic levels
• Gyms + Personal Trainers 47% below pre-pandemic levels

Victorian winners and losers

Winners:

• Food Delivery 167% above pre-pandemic levels
• Health Services 147% above pre-pandemic levels
• Petrol Stations 69% above pre-pandemic levels (most likely due in the last week to the 25km radius increase)
• Pet Care 66% above pre-pandemic levels
• Gambling 19% above pre-pandemic levels

Losers:

• Entertainment (Movies, Arcades, Bowling etc.), 97% below pre-pandemic levels
• Public transport 79% below pre-pandemic levels
• Gyms + Personal Trainers 89% below pre-pandemic levels
• Retail 73% below pre-pandemic levels

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with weekly insights on the current state of play. Want to know more? Further data is available here.

Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a fortnightly economic update, and we think you’ll find it useful in these strange times.

New data released today shows a slew of new infrastructure has turned Western Sydney into ‘toll town’, burdening residents with a significant financial burden – tolls on the daily commute.

Data from the transactions of millions of commuters was used to calculate the average spending on tolls per household each week (May – September 2020).

It shows an abundance of toll roads in Sydney is having a significant financial impact on people from Wollondilly in the south west, through Camden, Liverpool, Penrith, Fairfield, Blacktown and up to The Hills in the north.

Commuters heading from Marsden Park to the Sydney CBD by car will pay $18.83 one way if they use the M7, M2, M1 and Harbour Bridge.

Commuters heading from Campbelltown to the Sydney CBD by car will pay $19.88 one way if they use the M5 and M1.

Average household expenditure on tolls across Western Sydney

The data shows areas where the average household pays the largest tolls. The average household weekly spending on tolls across Western Sydney are:

• Wollondilly – $14.89 per week – the average household pays more than double (112%) in tolls than inner metro. For the top 10% of households paying tolls this is $5,274 per year.
• Camden – $15.26 per week – the average household pays more than double (117%) more in tolls than inner metro. For the top 10% of households paying tolls this is $5,051 per year.
• Liverpool – $11.70 per week – the average household pays 66% more in tolls than inner metro. For the top 10% of households paying tolls this is $6098 per year.
• Penrith – $10.36 per week – the average household pays 47% more in tolls than inner metro. For the top 10% of households paying tolls this is $5188 per year.
• Fairfield – $11.04 per week – the average household pays 57% more in tolls than inner metro. For the top 10% of households paying tolls this is $6046 per year.
• Blacktown – $9.57 per week – the average household pays 36% more in tolls than inner metro. For the top 10% of households paying tolls this is $5953 per year.
• The Hills – $11.75 per week – the average household pays 67% more in tolls than inner metro. For the top 10% of households paying tolls this is $5854 per year.

Residents of areas closer to the CBD are paying less than half in tolls in many cases:

• Inner West – $6.95 per week or $362 per year
• Ku-ring-gai – $7.13 per week or $371 per year
• Ryde – $6.62 per week or $344 per year

The high toll-paying suburbs from Campbelltown in the south, to The Hills in the north is Sydney’s new ‘latte line’ – a division in Sydney that speaks to the growing inequities in our city.

This data shows the slow creep of toll roads in Sydney; nibble by nibble they have turned into a financial shark bite for commuters in some parts of the city.

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with weekly insights on the current state of play. Want to know more? Further data is available here.

Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a fortnightly economic update, and we think you’ll find it useful in these strange times.

New data released today shows how the Australian Government’s textbook stimulus response offset falling spending in the rest of the economy.

During the COVID pandemic Australian consumer spending dropped very rapidly – down 21% below normal levels at the height of the pandemic.

In response, the Government implemented a strong set of stimulus measures. These stimulus measures helped support overall spending in the economy.

Throughout April and July, the increased spending from recipients of government support helped to offset falling spending in the rest of the economy.

In the last two months, spending has returned to normal for people who did not receive support – which is the textbook outcome stimulus is supposed to achieve.

Without this stimulus, the economy would have fallen much further.

Government achieves Goldilocks result

The Government’s stimulus for consumers has been effective in filling the gap in household spending during the height of the crisis. Achieving this outcome is like landing a plane on top of a lorry. It’s the classic Goldilocks result.

While we need to continue to be vigilant to ensure that households don’t go backwards, this is a textbook use of stimulus and it has certainly worked.

As the stimulus is slowly wound back, it is going to be very interesting to see where we all end up. What has stayed the same – and what has changed forever?

Through illion’s real-time tracker, we will be keeping our finger on the pulse and will call out any permanent changes – and how they affect the lives of everyday Australians.

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with weekly insights on the current state of play. Want to know more? Further data is available here.

Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a fortnightly economic update, and we think you’ll find it useful in these strange times.

New data released today shows the important role coffee is playing in helping COVID-weary Aussies cope with the daily grind.

Whether it’s a time-honored cappuccino or a trendier macchiato, caféphiles in Sydney and Melbourne continue to feed their cravings for fresh ground caffeine in the suburbs.

Sydney suburban café spending is up

While it’s true that coffee consumption in the Sydney CBD has fallen, the traditional latte lines of Sydney have increased their suburban café spending, with the eastern, southern and northern beaches all seeing rises in spend of up to 20%. Waverley is the standout, with coffee consumption up around 50%.

Further out, most suburbs have seen an increase in café spend consistent with a large part of the population working from home, particularly through to July.

This data shows that if working from home continues over the next year, we will entrench a new vibrancy in the economic activity of our suburbs.

And if the trend continues, we will see other local business impacts strengthen in suburbs, including more small businesses and smaller retail precincts thriving.
Rockdale, Botany Bay, Ku-ring-gai and the inner west of Sydney have shown the largest declines in spending.

Meanwhile in Melbourne, café spending varies by LGA

Melburnians working from home in strict lockdown are still frequenting their local cafés in droves, with wealthier areas such as Bayside showing a 40% increase in café spending.

It appears that in both Melbourne and Sydney, the wealthier ‘latte-set’ have found creative ways to continue to meet their daily caffeine craving.

While café spending is up in many places in Melbourne, it’s a different story in the Monash Local Government Area (LGA), where Monash University students are hard to find and coffee consumption has plummeted almost 50%.

And in a sign that COVID concern is overriding caffeine addiction, the City of Melbourne and Port Phillip (home to large offices on St Kilda Road) have seen at least 25% drops in spending. Northern parts of the city are either flat or slightly down, particularly in higher case COVID areas such as Whittlesea.

After such a challenging year, it’s likely that many of us will be drinking more coffee just to keep awake when we kickstart the economy again.

Further high-level summary data is available here.

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with weekly insights on the current state of play. Want to know more? Further data is available here.

Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a fortnightly economic update, and we think you’ll find it useful in these strange times.

New data released today has confirmed New South Wales was on the same downward spending trajectory as Victoria in early August, with its lowest spending since early June.

This week’s spend data, however, has seen New South Wales recover slightly to re-join other states, but it is still at 3% below pre-crisis levels.

Overall spending in Australia is down 5% on normal levels, largely brought down by the continued strict lockdown in Victoria.

Interestingly, spending impacts are being seen in all states, including even Western Australia, which at 2% below pre-crisis levels, is seeing its lowest spending since the end of June.

Unsurprisingly, given the Stage 4 lockdowns, Victoria continues to decline and spend is now at 22% below normal levels.

It’s clear that the Victorian lockdown is having a psychological spending impact across Australia. The impacts are being seen as far away as WA – which shows that even with border closures, you can’t keep out the economic impacts of COVID-19.

Category spend in New South Wales and Victoria

• Cafés have bounced back in NSW to 18% above normal, compared to VIC, where café spending is now down 42%.
• Online retail has spiked again in VIC (+21%), compared to NSW (-14%).
• Fashion and leisure retail have dropped in VIC (-54%) vs NSW (+25%)
• Gyms in NSW are back to pre-crisis levels, whilst spending at gyms in VIC has dropped to 25%.
• While health services spending in VIC remains extremely high (+ 100%), NSW is now back to normal levels.
• Supermarket spending has also dropped to 12% below normal in both states, after Victoria spiked during early Stage-4 restriction panic buying.

Gyms in New South Wales are a clear winner, now going even stronger than their busiest phases in January. Could this be people wanting to get rid of their COVID kilos and get ready for summer?

Further high-level summary data is available here.

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with weekly insights on the current state of play. Want to know more? Further data is available here.

Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a fortnightly economic update, and we think you’ll find it useful in these strange times.

New data released today has confirmed that early superannuation withdrawal continues to drive a huge spending boom and that the program has not been used as intended by many Australians.

The analysis of de-identified, aggregated information from more than 10,000 Australians who withdrew superannuation early continues to find some disturbing facts about what it was spent on.

Many people may not have needed to access their Super early at all.

In fact, 38% of people who accessed superannuation saw no drop in their income during the COVID crisis. 21% saw an increase in their income of more than 10%.

With no requirement for documentation to prove income loss prior to allowing access to early Super, it raises the question of whether they really needed the extra money.

The money was spent quickly: almost half of the total money withdrawn was spent on purchases in the first fortnight. On average, Australians withdrew around $7,495 and spent an extra $3,618 in the first fortnight, compared with what they spent in a normal fortnight before receiving early Super.

As with the first round of early Super withdrawal, people have used this money to increase their spending, not simply maintain it. Almost two-thirds (64%) of this additional spending was on discretionary items such as clothing, furniture, restaurants and alcohol.

Spending on debt repayments has dropped slightly since the first round of early Super withdrawal (14% to 12%), and there has been an increase in essential spending (22% to 24%).

This second tranche of Super withdrawal and spending follows the same trend as the first round – but at greater levels of spending.

While this policy was aimed as a lifeline, more than half the people that withdrew the second amount had no change in income. In fact, almost a quarter had increased their income and still continued to withdraw from their retirement savings.

These short-term decisions will have a major impact on the retirement incomes of those who withdrew their Super.

Split by gender

The average Super withdrawal by gender in the second round was $7,240 for women and $7,750 for men.

• Men and women continue to spend in different ways – with women spending almost 30% on essential goods and services, and men spending 22% on essentials.
• Men are still leading with gambling spend, with 10% of their Super money spent on gambling, against 6% for women.
• Women spent 15% of their Super money on debt repayments, while men spent 12%. This includes Buy Now Pay Later payments.

For many, the real impacts of early Super withdrawal will only be felt years down the road. A double withdrawal by mum and dad now potentially means that a chunk of their retirement saving has been spent.

The financial impacts of COVID-19 will be with us for a very long time.

Further high-level summary data is available here.

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with weekly insights on the current state of play. Want to know more? Further data is available here.

Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a fortnightly economic update, and we think you’ll find it useful in these strange times.

New data released today has confirmed that spending continues to rise to 15% above pre-crisis levels, driven by the massive cash flow impact of early withdrawal of up to $10,000 in superannuation money and the impact of $750 Stimulus payments.

The new data – covering 20-26 July – has revealed that almost all of the growth in spending above normal levels is still due to Stimulus and Super. When those who were eligible for the Stimulus and received Super were removed from the sample, average spending was 5% above normal levels.

Victoria’s spending remains well below other States, around 16% below NSW.

How the Stimulus was spent

Australians receiving the Stimulus payments spent an extra $53 on groceries, compared to consumers with a similar profile that had not yet received the Stimulus. Similarly, the Stimulus caused recipients to spend $66 more on Buy now pay later (BNPL) and $31 more on clothing and other merchandise.

The initial Stimulus spending from April was more focused on essential items. Australians receiving the Stimulus payments in April spent an extra $109 on groceries and an extra $38 on rent and housing costs.

We know the Stimulus has worked. For recipients of the Stimulus the second time around, we can certainly see a shift to more discretionary spending – particularly in the BNPL category.

The one constant has been incredible food delivery figures. Australians have continued to prop up their favourite pubs and restaurants, even in lockdown conditions.

Even though many people in Victoria are back in strict lockdown, a massive drop in spending has been averted up to this point with the new Stimulus payments and early superannuation withdrawals. Whether that remains the case is a key question.

Further high-level summary data is available here.

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with weekly insights on the current state of play. Want to know more? Further data is available here.

Credit Simple is part of the illion group of companies. illion has partnered with AlphaBeta to create a fortnightly economic update, and we think you’ll find it useful in these strange times.

New data released today by illion and AlphaBeta, part of Accenture, has confirmed that spending in Australia has skyrocketed to 17% above normal levels, driven by:

• The massive cash flow impact of early withdrawal of up to $10,000 in superannuation money, and
• The impact of $750 Stimulus payments that will shortly arrive in the bank accounts of 5 million Australians as part of the next round of Stimulus payments.

What’s driving this growth?

The new data has revealed that almost all of the growth in spending above normal levels was due to Stimulus and Super. When those who were eligible for the Stimulus and received Super were removed from the sample, average spending was actually 2% below normal levels.

This is a good sign because it means spending is almost at pre-COVID levels from those who did not receive government support.

Panic buying before the second lockdown in Victoria has buoyed spending in that state, and has helped arrest the plummet we will likely see next week.

This data covers 6-12 July, which includes four days of the full Melbourne lockdown and NSW closing the border.

There has been a significant improvement across category spend in Australia from 9 weeks ago:

• Gyms and fitness have moved up 70 points to 25% below pre-COVID levels
• Public transport continues to improve slowly, up 23 points to 57% below pre-COVID levels
• Department store spending continue to help the economy, now up 54% from pre-COVD levels

Spending in Victoria is around 15% below other states

Panic buying in Victoria buoyed spending and helped arrest the plummet, likely to be seen in next week’s dataset. NSW, Western Australia and Queensland are all back to pre-COVID levels, which can be attributed to restrictions being removed (WA) and school holidays (NSW).

Consumer spending across all states except Victoria has skyrocketed and this is due to Stimulus and Super payments. The most interesting part of this data is that while Super and Stimulus payments have accelerated spending, we are now also seeing spending creep up to pre-COVID levels from those who did not receive such support.

The signs of consumer spending in all states except Victoria is very encouraging. Once Victoria gets through this second wave – and assuming it is contained within the state – we will almost certainly see spending increase across all states.

Find out more

As COVID-19 continues to impact the economy, illion is working with AlphaBeta to provide you with weekly insights on the current state of play. Want to know more? Further data is available here.