New research from CoreData suggests more WA households are dipping into their savings to escape the cost of living crisis.
Australia’s inflation rate may be trending sideways, but Western Australians are still feeling the pinch, according to new research from CoreData WA.
The consultancy’s WA Pulse Check report indicates the state’s residents are tightening the purse strings as the cost of living continues to rise.
The report was released just prior to the latest ABS consumer price index figures, which revealed that headline inflation held steady at 2.5 per cent over January.
While that news may bring some relief to Australians, economists are still mixed over what effect the figures will have on the Reserve Bank of Australia’s next cash rate decision, expected on April 1.
Inflation’s impact becomes clear when assessing a household’s holiday spending habits, according to CoreData WA founding director Kristen Turnbull.
“In 2020 and 2021, people’s spending increased by nearly twenty-five per cent in the December quarter compared to the previous quarter,” Ms Turnbull said.
“However, the boost in spending has fallen in more recent years, to sixteen per cent in December 2022, fourteen per cent in 2023, and seventeen per cent in 2024.”
“While West Aussies’ overall spending has increased as a result of inflation, the pre-Christmas surge last year was less noticeable than what we saw during Covid when people were not able to travel.”
More than a quarter of the 1,000 Western Australians surveyed by CoreData reported they had nothing left after paying their bills during 2024’s festive season.
Photo: CoreData.
Consequently, the data suggests more families are dipping into their savings to keep up.
“The WA household saving ratio was just eleven per cent in June 2024; half of what it was three years prior,” Ms Turnbull said.
“Concerningly, more than a quarter of Western Australians tell us they have no disposable income at all.”
Beyond discretionary spending, CoreData’s report indicates that housing affordability remains a key issue for the state.
Photo: CoreData.
In the first three quarters of 2024, the price for an average home increased 5.6 per cent, more than double what it was in the first three quarters of the year before.
It’s not all doom and gloom, however: WA’s unemployment rate remains below 4 per cent, and nearly half of the Western Australians surveyed report they are not concerned about job security.
Moreover, two in five respondents claim their job provides them enough income to live comfortably.
Job stress is also reportedly down from the September quarter, likely due to households having more options to take time off work during the holiday season.
Photo: CoreData.
