Closeup of woman in yellow jacket using mobile phone and holding shopping bags

While the spike in trading in the latest ABS Preliminary Retail Trade Figures was expected it came with cautionary words from the Australian Retailers Association.

There was a 16.3% lift in estimated retail turnover from April to May 2020, with turnover increasing 5.3% in May 2020, compared with the same period last year.

“It’s heartening to see the elevated trading in May, but it’s too early to see this as a business as usual picture,” ARA CEO Paul Zahra said. “Retailers are still experiencing a ‘sugar hit’ from suppressed spending during lockdowns across the previous month and we are conscious that consumer spending is also bolstered by JobKeeper payments.

“May marks the beginning of a slow and hard-fought path towards recovery for our retail sector. Whilst most stores have now reopened, many face significant ongoing financial pressure resulting from hibernation, increased new hygiene protocols and a reduction in overall foot traffic.”

Zahra predicted foot traffic was likely to be more subdued across the winter months as tourists, workers and visitors remain at low levels, particularly in city locations.

National Retail Association CEO Dominique Lamb held a similar view that the sizeable rise in sales was guaranteed to happen as shops began to reopen, while recognising the sector is still struggling.

“It’s certainly good news to see retail sales rebound strongly in May and hopefully it’s a sign that we are recovering from the economic sledgehammer of COVID-19,”Lamb said. “However, we do need to remember the broader context as these figures were recorded following the worst month on record in April 2020 and followed the easing of business restrictions, so an uptick was to be expected.

“The fact is many retailers are still struggling and retail is far from being out of the woods, but hopefully the ABS results demonstrate that we are on the road to recovery.”

JobKeeper and JobSeeker programs have also helped keep ticking things along, but these are only temporary measures which won’t maintain strong consumer confidence, she said.

The ABS figures arrived as American Express released its Small Business Recovery research following the launch of its eighth annual ‘Shop Small’ initiative. The research revealed that 52% of Australian small business owners fear for their long-term survival if trade doesn’t pick up quickly.

The research also showed current anxiety within the small business community, with many shoppers still wary about returning to bricks-and-mortar shops. Only 33% were comfortable returning to bricks-and-mortar shops and 22% will only return to physical stores when zero cases are recorded in their respective states. Another 15% said they would only return to the shops when no cases exist nation-wide.

Another report on public attitude to shopping came from research conducted in June by YouGov that found only 61% of respondents  said they felt safe returning to non-essential shopping due to fear of COVID-19, while fewer than half, 49%, said they felt safe going to back to work.