Weekend Edition: Delving deep into household spending
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What is the new Household Spending report and why is it replacing the Retail Trade survey?
The Australian Bureau of Statistics have been ramping up their household spending report. So what does it do that it didn't do before? How useful is it going to be? And where are they going next with it? We'll look at all of that this weekend. The morning call from NAB with Phil Dobby. The weekend edition. Well, last week we got uh two different sets of consumption numbers from the ABS. We got the retail trade numbers, which shows us turnover and volumes for retail businesses, both in store and online. And that showed for the month of May, turnover had increased by naught point one percent in the month. And then at the end of last week we got the new monthly household spending indicator. It's been around for a while, but it's been revamped.
It showed seasonally adjusted how Household spending had increased by naught point nine percent. In May. So what's the difference? Well, we don't have to worry about uh the difference for much longer because the next retail trade data is the last one for that report. The enhanced household spending indicator should give us everything we need to know. So let's look at the differences and what's in this new report with Robert Ewing, whose job title is Program Manager, Business Statistical Production and Future Branch. Wow. Uh futures branch, I should say. say well. I mean that's you're a change manager, Robert. I'm reading in your job title.
Uh look, that's part of my role. Um I mean my my simpler title, um, you know, that I put in the media releases is ABS Head of Business Statistics. So I'm kind of leading large turns. Just stay
with that then. Yeah. Yeah. Okay. So the difference between those two numbers then, uh so retail turnover, naught point one per cent. Household spending which you I would have thought would be about the same 'cause, you know, the retailers are selling to people in households up naught point nine percent. So shouldn't they be more or less the same?
So I think what what's really important to understand between these two indicators is that they're measuring very different parts of household spending. Um and that really kind of goes to the reasons why we're moving away from retail trade to monthly household spending. Retail trade only covers about one third of the money that households spend. And it is a slice that's kind of, you know, includes some things that obviously we have to buy, like um food, groceries, that kind of thing.
How does the new indicator differ from the old retail‑trade numbers in scope and coverage?
Um things which are much more discretionary, such as alcohol, um tobacco, and you know, things that are very discretionary, like recreational goods. And so the mix of that discretionary non discretionary component is um kind of probably not giving you like a realistic picture of the overall state of what households are spending money on. The new monthly household spending indicator it covers about sixty percent Of household spending. So it's adding in to what the retail trade survey covers. It adds in big purchases like motor vehicles, which have been excluded from the retail trade survey for historical reasons, and also a lot of purchases of services, particularly health, recreation, and transport.
And in some of those components, we see some of the big differences between the numbers that we saw for the month. month of uh May in the retail trade survey versus the household spending indicator. Right.
So on the services, so if I spent uh three hundred dollars a month getting my hair done, would that have been included in the old retail numbers?
No, no. So the retail numbers Unfortunately it's always a little bit more common. Did pick up a couple of services, so it picked up cafes and restaurants. We included those because they're very retail like, but it didn't include things like hairdressers, um, you know, car repairs, didn't include the fuel you bought at um petrol stations, um, you know, didn't include the money that you spent um on the doctors, but did include the money you spent at the chemists. So
Right.
It's always it had become a much patchier picture of spending as we go along. If we actually look back to when we started the retail trade survey, so the first retail trade surveys were actually back in the nineteen fifties.
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Chapters
8 chapters
1
What is the new Household Spending report and why is it replacing the Retail Trade survey?
0:01–2:10
2
How does the new indicator differ from the old retail‑trade numbers in scope and coverage?
2:10–5:20
3
Why does the Household Spending indicator now include motor‑vehicle purchases and service spending?
5:20–8:45
4
How are bank transaction data and supermarket scanner data combined to build the indicator?
8:45–12:17
5
What steps does ABS take to ensure the quality and accuracy of the aggregated data?
12:17–16:14
6
Can the publication timeline be shortened without sacrificing reliability?
16:14–19:30
7
What future enhancements (geography, spending categories, online vs. in‑person) are planned for the report?
19:30–22:50
8
How will policymakers, investors and retailers use the new Household Spending data?
22:50–25:45