‘Holding back’: Another sign Aussies are doing it tough

In more troubling signs for the economy, Australians are spending less in this area, with cracks forming in the digital economy.

Australian adults are less in online transactions.

Australians spent about $600 less on online purchases than they did this time last year in yet another sign that the cost of living crunch is putting the squeeze on households.

The figures come from global financial platform Airwallex’s Digital Economy Index, a quarterly year-on-year snapshot of the digital economy.

It estimates online spending dropped $587 per adult across the 12 months up to and including Q2 2023 compared with Q2 2022.

That represents a 1.82 per cent drop nationwide, worth about $523.3m.

Airwallex’s Digital Economy Index shows Australian adults are spending about $587 less in online transactions than at the same time last year.

Breaking the data down by state, Victoria, Queensland, Tasmania, and Western Australia all experienced growth in online spending, with Tasmania leading the charge with digital revenue turnover up 12.8 per cent.

But there are signs of a looming contraction, with that figure down 4.89 per cent on the previous quarter.

Meanwhile, South Australia was the worst performer, with online spending shrinking 16.77 per cent and declines recorded across all industries in the digital economy for both 2023 quarters thus far.

The figures also comes off the back of the Australian Bureau of Statistics’ monthly household spending indicator, released on Tuesday, which found overall household spending was up 3.3 per cent in May compared with the same time last year.

But that was largely due to rising costs, with discretionary spending down 0.6 per cent as Australians cut back on non-essentials.

Airwallex director of strategy Amelia Hamer says the figures show Australians are cutting back on discretionary spending. Picture: Supplied.

Airwallex director of strategy for Australia and New Zealand Amelia Hamer says the index shows online spending is uneven across the country as different states experience different economic conditions.

“Across the digital economy, we see Australians are holding back on their discretionary spending,” Ms Hamer said.

“We see several bright spots in Australia’s digital economy, with the technology, education and travel sectors seeing the most upside.

“There are still lingering effects of the travel bounce-back post-Covid in this data, with the surge in online travel particularly benefiting destinations like Queensland, Tasmania and WA.

“However, the data shows that NSW is bearing the brunt of the change in how Australians are spending their money online. This downturn is something we’re seeing in the quarter-by-quarter comparisons in other states too.”

Originally published as ‘Holding back’: Another sign Aussies are doing it tough