In his keynote at Online Retailer 2022, Westpac Senior Economist Matthew Hassan detailed key statistics heading into the second half and predicted how the retail sector would be affected by financial trends. current.
Hassan used a combination of ABS statistics and Westpac economic data to examine a number of important information regarding the economic future of Australian retail, including the continued impacts of covid on the market and how global inflation could continue to exert pressure on customer confidence.
All in all, forecasts indicate that consumer confidence will rise as the aftershocks of covid continue to impact the market, with the number of online purchases continuing to increase.
As retail begins to fully open up following pandemic-mandated shutdowns in recent years, Hassan and Westpac predict a “blooming reopening” followed by a slowdown in economic activity as rate hikes have an impact on the industry.
Hassan also spoke in detail about the current global attention on ESG (Environmental, Social and Governance), stressing the importance of setting targets in the coming years with COP26 less than five years away.
“In five years, big companies will be unable to get a loan from a bank unless they can provide a credible plan to reduce their carbon emissions,” Hassan said.
While retail is unlikely to be at the center of this ESG-based revolution, Hassan believes it will impact companies’ ability to connect and engage with customers, a factor important to consider as retail moves increasingly towards a personalization-centric world.
On the positive side, Westpac predicts a reduction in the number of unemployed in the coming years, although current figures may be misleading the reality of about 4% unemployment nationwide.