The growth in household spending has slowed in recent months following pressures in cost-of-living expenses, which have caused households to tighten their spending, according to Robert Ewing (pictured), the head of business statistics at the Australian Bureau of Statistics (ABS).
In a press release detailing the figures released by ABS in its Monthly Household Spending Indicator October 2023, a report that captured the payment for goods and services by Australian households, it was found that household spending was 2.7% higher than it was a year ago.
“The 2.7% increase in the year to October follows a downward pattern after spending rose 5.2% in the year to August, and 4.3% in the year to September,” said Ewing.
With less spending on discretionary services such as eating out, accommodation, recreation and cultural services, discretionary spending declined by 2% while non-discretionary spending increased by 7% in comparison to October 2022.
The rise in household spending was caused by increases in transport (+13%), health (+10.8%), and alcoholic beverages and tobacco (+7.1%) spendings.
Compared to the same time last year, all states and territories saw a rise in household spending. Western Australia saw the largest increase with 6.9%, followed by the Australian Capital Territory with 5.5% and South Australia with 4.3%.
The Northern Territory was the only state or territory to have recorded a higher spending growth rate, while the Australian Capital Territory had the largest decline in growth as it dropped from 7.8% in September.
The Monthly Household Spending Indicator is produced using aggregated and de-identified card and bank transactions that came from banking and financial institutions. It included nine of the 13 key divisions classified according to the Classification of Individual Consumption by Purpose.