One in five sole traders thinking of moving back into bigger organisations according to Hnry


The Westpac and Melbourne Institute of consumer confidence declined in March as consumers remain deeply pessimistic, but the bank’s senior economist Matthew Hassan said there were signs of improvement.

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“Inflation continues to dominate the news cycle, but responses suggest the cost-of-living ‘crisis’ has become less acute,” he said, adding inflation was less dominating of news coverage.

While spending on Taylor Swift’s Eras Tour had a small impact on retail spending in February, bumping up spending on clothing, footwear and accessory retailing and department store spending, overall retail spending continued to stagnate.

Turnover in household goods, other retailing and food retailing all fell, last week’s Australian Bureau of Statistics figures showed, while spending on cafes, restaurants and takeaway food also got a small boost.

Retail trade has stagnated because household spending has also flatlined. Commonwealth Bank’s February household spending insights index also fell, as consumers pulled back on spending across 12 categories including household goods, motor vehicles, food and beverage and education.

Those drops were partially offset by increased spending on utilities, health and household services, and the strongest increase in spending in February was on insurance, up by 9.9 per cent.

High inflation and high interest rates continue to dampen consumer spending.

High inflation and high interest rates continue to dampen consumer spending.Credit: Dan Peled

Hnry Australia managing director Karan Anand said inflationary pressures were raising costs for sole traders and that those operating in discretionary services such as creative freelancers were feeling the biggest pullback in spending.

“Lots of journalists, freelance writers, photographers, videographers, artists, graphic designers – that segment is performing the worst,” he said. Despite flatlining spending and low consumer sentiment, sole traders said they felt more optimistic about the near future than they were late last year.

The Hnry results showed 35 per cent were feeling positive about the economy in the next six months, above the 23 per cent in October and the highest level since March 2022. Anand said this was down to a mix of optimism about the future of their own business and the improving outlook for the economy.

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“If you’re going to decide I’m stepping away from PAYG employment and the safety of that, to start my own business, you have to be optimistic. And the people who are choosing to stay in self-employment are inherently optimistic,” he said.

McPhie said her skin therapy business was now on a much better footing as she had been making almost daily sales through her online store and was excited about the future.

“When I look at my books for the next few months, it’s good, it’s positive,” she said. “I honestly feel like everybody’s feeling that they can relax a bit and spend a little bit of money on themselves again.”



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