Baby boomers dominate spend on travel as younger people pull back
LOS ANGELES: Cashed-up baby boomers continue to drive much of the spending reported in the travel sector, with new data also showing the cost of living squeeze may be easing for households.
Fresh credit and debit card data from Bankwest, to be released on Friday, revealed travel agency recorded the biggest growth in transaction volumes year-on-year in July, up 50 per cent. Airline and hotel/motel were both up 29 per cent.
A further breakdown of spend by generations revealed Boomers were outpacing the other age groups in transaction volumes for airlines, up 39 per cent over the year. This was in comparison to Gen X (up 20 per cent) and Millennials (up 22 per cent).
Transaction value in the airline category also stagnated or went backwards for Millennials and Gen X, while Boomers grew 16 per cent.
“The spending capacity of many older Western Australians is largely unaffected by the current cost-of-living pressures and, in some cases, is enhanced from increased deposit rates,” Bankwest products and digital services general manager Peter Bouhlas said.
“That means there’s little incentive or impetus for those customers to change — especially reduce — their spending behaviour.”
QT Perth hotel manager Stephen Hollow said the business was seeing the strong return of both domestic and international travellers. He added length of stay was “significantly” longer and spend per stay was the highest it had been for both groups.
“Our conferencing and events business is also very strong and rising every month,” he said.
“There’s also strong demand in our food and beverage spaces and we’re now trading more services than we were pre-COVID, which is very exciting.”
The Bankwest data showed the majority of the spending categories recorded a single-digit change in the average value of transactions, suggesting prices were stabilising or even reducing. Service stations recorded the smallest growth in value over the year, down 11 per cent.
“Western Australians have faced cost-of-living pressures across multiple fronts, but these figures suggest some of those pressures could be easing,” Mr Bouhlas said.
“These figures do not suggest the end of the cost-of-living pressures that have been setting in for the past year is in sight, but they do show the majority of Western Australians are making clear choices on where they spend.
“The year-on-year stability in the number of customers transacting, from the essential food stores to discretionary sectors such as clothing stores, suggests customers are being more discerning in managing their home budget.”