Retail sales accelerate in November, Omicron tipped to impact new year spending

Tuesday 11 January 2022

Australian retail sales increased 5.8% in November 2021 compared to the same time in the previous year, and increased 19.8% compared to 2019, according to figures released today from the Australian Bureau of Statistics (ABS).

The Australian Retailers Association (ARA) said the November result is incredibly strong, with consumers taking advantage of the Black Friday sales, which is now well-established on the Australian retail calendar, whilst also shopping early for Christmas. However, spending is likely to slow this year given the current Omicron impacts on businesses.

The November ABS figures show Victoria leading the states, with sales up 8.4% compared to the previous year, followed by Western Australia (up 7.7%), South Australia (up 6%) and NSW (up 5.3%).

Clothing, footwear and personal accessories had the top performance in the retail categories, with sales up 16.5% in November compared to the same time in the previous year.

Online sales remain elevated, representing 12.5% of total retailing in November, however less than previous months, reflecting consumers return to physical store shopping.

ARA CEO Paul Zahra said retailers overall had a strong November, but businesses are facing fresh challenges with the rising cases of Omicron.

“We’ve entered new territory in the pandemic with Omicron decimating workforces and impacting supplies and deliveries of essential goods. Whilst retailers had an upbeat trading period in the lead up to Christmas, post-Christmas sales are unlikely to be as strong as we anticipated given the rising number of cases and flow-on effects to businesses and consumer confidence,” Mr Zahra said.

“November was very different to what retailers are facing currently. In November, we had record-break Black Friday sales, lockdowns had ended and consumers were confident and shopping early for Christmas. As Omicron has taken hold in the past few weeks, we’ve seen some businesses have to limit their trading hours given the number of staff in isolation, while others have had to close stores in some locations altogether.

“We welcome moves to ease isolation requirements on essential workers who are close contacts. This should address some of the supply challenges the major grocery retailers have been facing. However, there are other areas of retail that are also severely impacted by staff shortages which deserve attention. We need to safely allow close contacts who test negative to return to the workforce as soon as practically possible. We also need to consider support packages targeted to businesses forced to close,” he said.

A recent poll of ARA members found that 76% of retailers currently have staff in isolation, which highlights the crisis situation many businesses are currently under. The ARA has repeated calls for each level of government to:

  • ensure free (government subsidised), immediate and appropriate priority access to Rapid Antigen Tests for essential, frontline retail and distribution centre workers

  • immediately provide an efficient and timely reporting mechanism for RAT tests for retail and distribution centre workers, preferably via state QR check-in systems

  • immediately end requirements (where they exist) for reporting of test results to multiple agencies before employees are cleared to work

  • allow workers who test negative to return to the workforce as soon as practically possible

/Public Release. View in full here.