Retail massacre: Australian stores have experienced the worst slump ever as the nation braces for a recession
- Retail sales fell 17.7 percent in Australia in April, a record low for the season
- Clothing and footwear sales suffered the most, down 53.6 percent from 2019
- Online shopping doubled from this time last year, accounting for 20 percent of sales
- Here’s how you can help people affected by Covid-19
A surge of online shopping was not enough to pull Australian retail out of the worst crisis this time of year.
The coronavirus pandemic resulted in a sales decline of 17.7 percent in April 2020.
Clothing and shoes were hit hardest, but historical lows were also recorded in the food and catering sector.
A surge of online shopping was not enough to pull Australian retail out of the worst crisis this time of year
New data from the Australian Bureau of Statistics on Thursday revealed that the industry is struggling after the economic blow from the wildfires in the summer.
Quarterly Economy Wide Surveys Director Ben James said the pandemic and surrounding restrictions had a serious impact on retail.
“COVID-19 continued to impact retail in April, with many retail businesses closing their brick and mortar stores in April due to restrictions on social distance,” he said.
There was a 53.6 percent drop in apparel, shoes, and personal accessories, and a 35.4 percent drop in cafes, restaurants, and takeaways.
Department stores also lost 14.9 percent of today’s sales last year.
The closure of physical storefronts due to the corona virus caused a record drop in retail sales – from clothing to shoes, cafes and department stores
Stores across the country are offering serious discounts, like Portmans in the Sydney CBD (pictured) to try to make up for declining sales
Although the figures mainly negatively reflected the state of the economy, they showed that some expenditures had offset some of the potential losses.
This included a spike in sales of hardware, construction and gardening supplies as Australians kept home to work on unfinished renovations or other tasks.
While online sales also doubled from this time last year, it accounted for 11 percent of all retail sales for April 2020, compared to just 5.7 percent the previous year.
The owner of Westfield Malls’ shopping centers, the Scentre Group, reported that the number of customers had steadily increased in all of its centers in Australia and New Zealand over the past month.
ANZ also reported a 25 percent increase in retail spending growth on ANZ debit and credit cards.
Josh Frydenberg became the first federal treasurer in three decades to confirm that Australia was in recession at a news conference on Thursday.
Gross domestic product, also known as GDP, declined 0.3 percent in the March quarter due to COVID-19 and the summer forest fires, official data from the national accounts showed.
Should the economy shrink again in the June quarter, Australia will be in recession for the first time since 1991, ending a world record of uninterrupted growth.
Retailers such as Nespresso in the Sydney CBD (pictured two staff in personal protective equipment outside the storefront) are hoping for more sales in June after a record slump in April 2020
AUSTRALIA BRACES FOR RECESSION
Gross domestic product shrank by 0.3 percent in the March quarter
It was the first quarterly GDP decline since the March 2011 quarter (minus 0.3 percent)
In the quarter of 2008, the economy contracted by 0.5 percent during the global financial crisis
It also declined by 0.4 percent in the December 2000 quarter, following the introduction of the GST
Australia’s economy has not shrunk for two decades in a row since June 1991 – the last time a recession occurred
A recession will not be declared until September, when the GDP figures for the quarter of June are released by the Australian Bureau of Statistics
Source: Australian Bureau of Statistics