From AAP. Only one-fifth of Australians think the national economy is in good shape, a new survey has found, in a grim assessment of consumer cheer heading into Christmas.
A quarterly survey by consumer advocacy firm CHOICE has found only about one in five people believe the Australian economy is in good shape – the lowest positive rating since its Consumer Pulse survey began in 2014.
The December results show that consumers are under increasing financial pressure and feel less positive about their household budget and the economy.
“Many Australians start to feel sharper financial pressures leading into the holiday period, as gifts and parties eat into our savings or credit balance,” acting CHOICE chief executive Matt Levey said.
Australians are also reporting a drop in spending on non-essentials, with more than half of respondents tightening the belt and putting off purchase of big ticket items.
CHOICE’s Consumer Pulse report found fears over the economy are the worst they have been since the survey began two years ago, with just one in four households saying they’re living comfortably.
“In particular, our survey shows that Australians between 30 and 49 are more likely to live off credit cards if they run out of money before pay day,” Mr Levey said.
A third of people under 30 said they dipped into their savings in the last year to make it to pay day, while a quarter had borrowed money from family or friends. About 20 per cent of people aged 30 to 49 reported they deliberately missed the due date on a bill.
CHOICE’s report follows the release this week of the federal government’s mid-year budget review, which forecast that despite lower savings, consumers will likely boost spending on the back of low interest rates and employment growth.
However, the Consumer Pulse figures show that consumers are not necessarily feeling confident enough about their financial future to take on more debt or spending.
“MYEFO’s predictions about household savings match what Australians have told our survey,” Mr Levey said.
“But this won’t necessarily translate into higher consumer spending. In the next 12 months, a majority of people say they are planning to cut back on discretionary and non-essential purchases.”
CHOICE’s Consumer Pulse report, which tracks Australians’ views about the economy and household spending, was based on online responses from 1025 people aged between 18 to 75 years.
