CCIWA Chief Economist
Aaron Morey
Household confidence has weakened as rising costs and interest rates weigh on the minds of Western Australians. Amid the turbulent conditions, CCIWA’s latest Consumer Confidence Survey shows Western Australians becoming more circumspect in their spending and choice of brands.
Weaker economic conditions are anticipated by around one in four WA households, both in the short term (26%) and looking out to the next 12 months (29%). One in three WA households anticipate the economy will improve in the coming year (36%), down 6 points.
Rising costs are the biggest concern for WA households, with three quarters of respondents (73%) feeling the pinch. Concern about interest rates reached a new high, leaping 27 points since the rate hikes began, reported by three in five (63%) respondents. Meanwhile confidence in the State Government (43%) and continued strong employment prospects (36%) stabilised the mood of households.
Echoing this focus on our State’s jobs market, Western Australians have strongly backed reducing the burden of the tax on jobs. Asked about their view of WA’s payroll tax, two in three respondents (65%) thought it was limiting and unfair for WA businesses to face a higher burden than the rest of Australia.
Both the pandemic and higher prices have also seen Western Australians re-thinking their spending choices. Three quarters of respondents (76%) say they had swapped brands in the past year, with price (47%) being the dominant factor. Factors like supporting local business (21%) and environmental considerations (19%) were also at play. In choosing a brand, Western Australians nominated corporate transparency (71%) and good environmental practices (70%) as important to their decisions.
Despite price pressures, one in five (22%) respondents are set to travel overseas in the next year, with the average traveller committing $9,000 to their trip.
As they adjust to rising costs, WA households look to the strength of the jobs market for reassurance. The best thing the WA Government could do for our competitiveness and economic growth would be to ease the high cost burden imposed by the tax on jobs.
