Australia’s cost-of-living crisis continues to deepen, with a new Woolworths survey revealing that nearly half of all households struggle to make ends meet, despite the Reserve Bank’s recent interest rate cut.
The internal research, shared in a closed-door meeting and obtained by The Australian, found that grocery bills have overtaken mortgage, rent, and utility payments as the primary financial concern for many Australians.
The study categorises affected groups including, families, young and middle-aged singles, and couples, under the acronym STMEM (“struggle to make ends meet”).
The January survey found that:
- 73% of families identified the cost of living as their biggest concern, ahead of housing (53%), health (31%), crime (27%), and the economy (16%).
- Among younger couples and singles, 76% cited living expenses as their top worry.
- 47% of families and 45% of younger and middle-aged singles and couples reported struggling financially, compared to 40% of older singles and 25% of retirees.
As a result, Australians are making significant lifestyle changes to cut costs, including:
- Downgrading petrol quality from premium to standard unleaded.
- Eating packed lunches at work to avoid food expenses.
- Cross-shopping between multiple retailers for the best deals, with over 80% of families and 70% of younger singles and couples engaging in this behaviour.
Both Woolworths and Coles have intensified efforts to retain budget-conscious shoppers through discounts, promotions, private-label products, and larger value packs.
Woolworths CEO Amanda Bardwell noted a sharp acceleration in value-seeking behaviour since mid-2024, with more consumers relying on sales and store-brand alternatives.
Coles CEO Leah Weckert echoed these concerns, stating that two-thirds of customers still feel “very stressed” about their household budgets.
The Australian Competition & Consumer Commission (ACCC) has completed an inquiry into supermarket pricing practises and supplier relationships, with its final report now under federal government review.
As economic pressures persist, value-driven shopping habits may become permanent, reshaping the grocery sector and household spending patterns across Australia.
