According to the latest Digital Economy Index by Airwallex, Australians are spending around $600 less online on average compared to last year.
The index provides insights into year-to-date spending per adult and quarterly snapshots of the digital economy by state and industry.
In the second quarter of 2023, there was a nationwide decline of 1.82 per cent in online spending, amounting to $523.3 million, compared to the same period in 2022. However, some states showed positive trends in online spending growth. Victoria, Queensland, Tasmania, and Western Australia saw increases in online spending, despite the overall decline.
The index highlighted notable increases in online education and travel spending, while retail, insurance, and self-managed investments experienced declines. New South Wales saw an overall decline in revenue turnover, driven by drops in online subscriptions and travel spending. However, digital travel businesses in NSW rebounded compared to the first quarter of the year.
In Victoria, digital businesses showed a nearly 6% increase in revenue turnover, fueled by growth in e-commerce spending and education. However, digital travel spending continued to decline. Queensland’s digital economy saw a 3.90% rise, primarily due to increased online travel spending, although there were declines in online education and e-commerce. Western Australia experienced a 2.81% growth in its digital economy, driven by online technology spending and e-commerce.
These findings offer valuable insights into the shifting trends in online spending across different states and industries in Australia. Airwallex Director of Strategy for Australia and New Zealand, Amelia Hamer, said the Index showed the spending downturn was uneven across the country as different parts of Australia felt the effects of the broader uncertain economic environment. “Across the digital economy, we see Australians are holding back on their discretionary spending,” Hamer said.
“As interest rates have climbed and cost-of-living pressures have increased, it’s no surprise Australians are being more selective about where they spend online. “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 bounceback post-COVID in this data, with the surge in online travel particularly benefitting 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.”
Estimated digital spend per adult by state
|Jurisdiction||Year to 2022 Q2 ($)||Year to 2023 Q2 ($)||YoY change ($)|
Digital Business Turnover by state
|Jurisdiction||% change 2022 Q2 to 2023 Q2||% change 2023 Q1 to 2023 Q2|
Digital Business Turnover by industry
|Category||% change 2022 Q2 to 2023 Q2||% change 2023 Q1 to 2023 Q2|
|Digital and technology||11.95||-7.50|
|Financial and insurance||-7.32||-6.06|