Australian retail spending is continuing to thrive in the lead up to Christmas, with overall sales up 25.9 per cent in September.

Sales were also up 32.7 per cent on pre-pandemic spending in September, according to the latest Mastercard SpendingPulse which measures in-store and online retail sales across all payment forms.

All retail categories continued to record “significant year on year sales growth as we cycle the east coast lockdowns of 2021,” the report read.

Sales of electronics were up 74.2 per cent for the month, year-on-year, with home furnishings up 51.4 per cent, jewellery up 113.8 per cent and apparel up 95.2 per cent.

“Retail sales continue to go from strength to strength,” notes Australian Retailers Association CEO Paul Zahra, “however the Delta lockdowns of 2021 are the driving factor behind the substantial growth we’re seeing in the year-on-year comparison.”

“It’s pleasing to see many retailers build strong momentum as they enter their most critical time of year – our holiday sales predictions with Roy Morgan show Australians will spend nearly $64 billion in the lead up to Christmas, up three per cent on last year.

“While consumers are challenged by rising interest rates and inflation, that hasn’t impacted spending here just yet. We appear to be experiencing a delayed impact from those factors, with a softening of sales more likely to occur in 2023.

“The biggest issue preventing retailers from trading at their full potential is staff shortages, with job vacancies increasing, and now running at over 46,000.

“Businesses are trying to recruit as many frontline staff as possible as they look to cover the increased demand over Christmas, but the reality is many of those positions will go unfilled.

“We acknowledge that it remains a challenging environment for small businesses on tighter margins in particular, as they continue to battle rising operating costs associated with fuel, energy, supply chains and rent,” Zahra concluded.