Sales growth in the three months ended September 30 slowed to 5.2 per cent.<\/p>\n
This was well below the long-term average of 7.8 per cent and reflects a decline with consumer-facing industries.<\/p>\n
Xero economist Louise Southall said the latest data shows Australians are still digesting the impacts of four cash rate rises this year.<\/p>\n
“The September quarter tells us small business conditions haven\u2019t worsened, but they also haven\u2019t improved,” Ms Southall said.<\/p>\n
“Rate rises typically take time to filter through to household spending, and that delayed effect is continuing to weigh on sales.”<\/p>\n
The mining, healthcare and construction industries led sales growth with 12 per cent, 8.1 per cent and 7.9 per cent jumps respectively.<\/p>\n
But sales growth for retail and hospitality remained subdued at 2.4 per cent and 2.7 per cent, respectively.<\/p>\n
Ms Southall said the data showed major investment in projects like data centres is only benefiting certain parts of the economy.<\/p>\n
“But the average local caf\u00e9, retailer or service-based business isn’t necessarily seeing those benefits,\u201d she said.<\/p>\n
\u201cFor most small businesses, higher costs and cautious household spending remain the bigger challenges.\u201d<\/p>\n
One silver lining from the data was jobs growing 3.9 per cent in the September quarter, up from 3.1 per cent in the three months to June 30.<\/p>\n
Ms Southall said the labour participation rate was at record highs, meaning less pressure to offer higher wages.<\/p>\n
“With workers choosing to stay in jobs for longer, there’s less pressure on small businesses to offer higher wages,\u201d she said.<\/p>\n
\u201cThat’s consistent with Australian Bureau of Statistics data showing more Australians are taking on second jobs.<\/p>\n
\u201cSmall businesses are still finding ways to hire, even as costs and softer sales limit what they can pay. The real test over the coming quarters will be whether that hiring momentum holds if sales and costs don\u2019t ease.\u201d<\/p>\n
The sales growth slump comes as consumer sentiment has dived while inflation and interest rates strangle household budgets.<\/p>\n
![\"Chalmers](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/10\/6d94acd8511b9838be3ef74ba520fe12.jpeg\")
<\/p>\n
Figures from the Organisation for Economic Co-operation and Development (OECD) show consumer confidence dropped 1.1 index points in the year to September.<\/p>\n
Australia experienced the third worst recorded drop in consumer sentiment, sitting only behind Chile and Belgium.<\/p>\n
Meanwhile, the Westpac-Melbourne Institute Consumer Sentiment Index dropped 4.7 per cent between September and October.<\/p>\n
Westpac\u2019s head of Australian macro-forecasting Matthew Hassan said consumers felt the continual cost-of-living \u201cnightmare\u201d with \u201cno end in sight\u201d.<\/p>\n
\u201cThe latest sentiment Index is amongst the forty worst reads since our monthly survey began in the early 1970s,\u201d Mr Hassan said.<\/p>\n","protected":false},"excerpt":{"rendered":"Wage growth is less than half its long-term average and is falling woefully behind inflation, a harrowing 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