Consumer confidence in Western Australia is continuing its upward streak, reaching a three-year high in the September quarter – an encouraging sign of economic activity and growth to come in WA.
The Chamber of Commerce and Industry WA’s (CCI) Survey of Consumer Confidence is the only survey of its kind in WA, canvassing the views of adult consumers located across both metropolitan Perth and regional WA.
CCI Chief Economist Rick Newnham said the trend increase in consumer confidence over the past three years is a positive sign for the WA economy, which has been struggling to recover since the mining industry’s transition from construction to production.
“CCI’s survey has revealed that 69 per cent of WA consumers believe the state’s economy will strengthen or remain the same over the next 12 months, up nine per cent from the June quarter,” Mr Newnham said.
“Short-term confidence has also continued to grow, up eight per cent from the previous quarter to 71 per cent.
“Consumers are however continuing to feel the pinch from the state’s economic downturn, with living costs such as groceries, utilities, and transport now the strongest factors influencing consumer confidence (69%).
“Around 65 per cent of consumers also stated that homegrown political news influenced their thoughts about the economy, which is to be expected in the wake of electing a new State Government and anticipation of their first budget being handed down after this period.”
Personal finances and job security continued to weigh on consumers outlook during the September quarter, with 37 per cent or respondents reporting deteriorating personal finances, and only 11 per cent of respondents stating that their employment situation had improved since the previous year.
“Given the subdued job sentiments, it’s critical that consumer confidence is not hampered by taxes or fees being levied directly on consumers or indirectly through business imposts in the State Government’s mid-year update,” Mr Newnham said.
“West Australians will already be faced with job losses of between 1,334 and 5,297 when the Government’s payroll tax rate increase is introduced on 1 July 2018. They cannot afford to take another hit just as they are starting to get back on their feet.
“We know that the Government is also looking to plug the $392 million hole left by the gold royalty rate hike being blocked, but the Government must recognise that economic activity will only strengthen if both consumer and business confidence is fostered.
“Threats of increased taxes, such as a bank tax, which will flow directly through to customers, will only do the opposite. To give confidence to business, the Government must fix the budget by reducing its own spending, not increasing taxes that will hurt economic recovery.”
To view CCI’s Survey of Consumer Confidence click here.