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WA households tighten belts, hospitality sector faces festive season hit

CCIWA survey finds 58 per cent of households plan to cut cafe and restaurant spending

By LineZotpaper
Published
Read Time1 min
Sources3 outlets
New survey from the Chamber of Commerce and Industry WA paints a bleak picture for the state's hospitality sector, with households cutting discretionary spending amid rising cost-of-living pressures and the Reserve Bank's decision to raise interest rates to a 15-year high.

The Chamber of Commerce and Industry WA released its September Consumer Confidence survey on Sunday, revealing deep concerns among Western Australians about their finances.

Almost two in five of the 1000 households surveyed in mid-August reported that their expenses outpaced their income each month. Twenty per cent said they had been unable to pay their bills on time, while about half of all respondents indicated they planned to cut discretionary spending to manage cost-of-living concerns.

The survey spells particular trouble for cafes, restaurants and the broader hospitality sector. CCIWA chief economist Dr Daniel Kiely noted that 58 per cent of those surveyed said they would cut spending on cafes and restaurants over the next six months, "which could have a significant impact on the sector heading into the festive period".

The findings come as households continue to contend with elevated inflation and the RBA's recent rate hike, which pushed the cash rate to its highest level in 15 years.

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Analysis

Why This Matters

  • A squeeze on household budgets directly threatens the viability of WA's cafes, restaurants and bars, a sector that employs thousands.
  • The festive period is typically the strongest trading window for hospitality; widespread cutbacks could trigger closures or reduced hours.
  • The data offers a real-time signal on how deeply the RBA's rate hike cycle is impacting consumer behaviour in a state often insulated by a mining-driven economy.

Background

The CCIWA survey provides a snapshot of consumer sentiment as the Reserve Bank of Australia continues its aggressive cycle of interest rate increases aimed at curbing inflation. Western Australia's economy has historically been buoyed by its resources sector, but the survey suggests households across the state are not immune to the broader national cost-of-living crisis. The survey was conducted in mid-August, before the RBA's most recent hike to a 15-year high.

Key Perspectives

WA Households: A majority are reporting their budgets are under severe strain, with many unable to pay bills and most planning to cut back on non-essential spending like dining out. Hospitality Sector: According to Dr Kiely, the industry is bracing for the most immediate pain as it heads into what should be its busiest period of the year. Critics/Skeptics: While the survey captures a grim outlook, the actual impact on the sector will depend on whether households follow through on their stated intentions and how the broader economy performs in the coming months.

What to Watch

  • Holiday season trading reports from major hospitality venues and the restaurant association.
  • The next CCIWA Consumer Confidence survey to see if sentiment deteriorates further.
  • Any shift in RBA forward guidance as consumer spending data softens.

Sources

Zotpaper

Written by software from the reporting listed above, scored by an automated standards desk, and published without a person reading it first. If something here is wrong, tell the editor and it will be put right.

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