Consumer confidence is on the rise, says ANZ-Roy Morgan, despite a new AMP Financial Wellness survey suggesting Australians’ financial stress is ‘higher than ever before’.
According to the latest consumer confidence findings from ANZ-Roy Morgan, consumer confidence levels have risen to their highest levels since early June, even in the face of a slate of rate rises and increasing cost-of-living pressures driving levels of financial stress for Australians. The numbers have risen a total of 1.1pts to 86.1 this week, sitting five points below the 2022 weekly average of 91.1.
But while the initial numbers look positive, elsewhere the survey’s findings paint a much more bleak picture, with as many as 40 percent of Australians surveyed suggesting that their families are more ‘worse off’ financially than at this time last year and only 8 percent expecting ‘good times’ for the Australian economy over the next 12 months.
“The recovery in consumer confidence is encouraging,” says David Plank, Head of Australian Economics at ANZ, “But it remains in very negative territory despite the lowest unemployment rate in decades.”
The effects of the cost-of-living crunch are being felt especially acutely in retail, backed up by as many as 48 percent of respondents to ANZ-Roy Morgan’s Consumer Confidence survey suggesting now is a ‘bad time to buy’ major household items.
This is further affirmed in the findings of a new Financial Wellness report published by retail wealth management and banking business AMP. Surveying 2013 Australians in June, the report’s findings suggest concerns about the future and the impacts of rising interest rates, inflation and a volatile marketplace are driving rates of financial stress.
Industries worst hit by an increase in financial stress include wholesale trade, with rates increasing to 36 percent from 19 percent in 2020, and administrative services, up to 33 percent from 17 percent two years ago.
The retail industry has also seen an increase in financial stress, with 26 percent now reporting financial stress, three percent higher than in 2020.
Repercussions from such high rates of financial stress are further impacting workplace productivity, with 21 percent of employees reporting being prevented from working productively by financial stress, nearly double the rate of 2020. This is especially true for men, with 30 percent of men reporting financial stress impacting their productivity at work compared to 12 percent of women, despite women generally experiencing poorer financial health and expressing more feelings of constant fatigue.
With much of the cost-of-living pressures outside of employers’ control, AMP suggest a greater focus on positive personal interactions between employees and employers in workplace environments is one key step to addressing the rise in financial stress impacting productivity in the workplace, further highlighting a need for employers to communicate to employees the value of their work.
With retails particularly relying on consumer confidence rates continuing to gradually rise, extending such positive interactions to relationships between retailers and consumers is arguably more important than ever. This reflects predictions from customer engagement platform Braze at the recent Power Retail Connect event, suggesting that retail is entering a new era compelling businesses to become ‘relationship-centric’ in their approach to consumers.
According to Braze’s Customer Engagement Review for this year, as many as 67 percent of consumers report that they would be more loyal to a brand willing to demonstrate a ‘human connection’.
If there is any hope for consumer confidence rates to continue rising in the face of high rates of financial stress, developing and prioritising such human connections in business settings is more important than ever before.
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