Any discussion on the difficulties of retailing at QVM will usually involve a trader saying “Things are just as bad out in the shopping centres and on the high streets” and you find yourself wondering if that is really true. Well, new data suggests that it is true.
The Australian Industry Group’s Performance of Services Index (which includes retail) stood at 47.5 for December. The index works on 50 as a median point with anything above 50 signifying expansion and anything below 50 indicating contraction.
There are a number of sub-categories in Services and, as you would expect, Health and Community Services expanded although it was the only sector to do so. Hospitality and Personal and Recreational Services remained very close to 50 points but Retail declined further to 43.9 points. Weak local economic conditions, fragile consumer and business confidence, and slower growth in household disposable income are all seen as factors.
A recent report in The Age has suggested that even our glamour mining states, WA and Queensland, have been really struggling as lower commodity prices and reduced investment impacts on the local labour markets. The old adage of a two speed Australian economy with mining states booming, and the other states stagnant, appears to be under question and that has implications particularly for the top end of QVM where interstate tourism is so important.
If we need some good news, then lower petrol prices are significant. The reduction of around 40c per litre over the last year translates to savings of $6.8 billion for the Australian economy according to The Age and that means more disposable income for our customers..