Every New Year, under the spell of the fireworks and with a glass of champagne in hand, millions of Australians express their need to start anew. But what is the real impact of the New Year resolutions? IBISWorld answers this question, one resolution at the time.
Each New Year people all over the world make solemn promises to themselves about the year ahead, and Australians are no exception. Many desire to become healthier while others express the desire to see the world or give back to the community.
While some will probably never put their wishful thinking into action, there are many who will work towards achieving their goals, which means that common New Year resolutions can have a big impact on the economy.
IBISWorld took a look at the most common eight resolutions and explained what their impact might be.
1. Losing weight
With the level of obesity in Australia having risen from 11.1% in 1995 to 24% in 2011, many Australians have decided to hit the gym and lose some weight.
IBISWorld expects the fitness industry to grow by 2.7%, reaching $2.9 billion in 2012. Also benefiting will be the weight loss industry, which is expected to grow 2.3% to reach $792 million.
“Late January and February is the busiest of the year for gyms, fitness centres and personal trainers as tens of thousands of Aussies commit to building a fitter, faster, stronger and trimmer self,” explained Karen Dobie, IBISWorld General Manager (Australia).
2. Quitting smoking and drinking
Quitting smoking is one of the most popular New Year resolutions, usually driven by health issues but now also by higher taxes and increasing packet costs.
Smoking rates have been dropping steadily since 1980, from 7.07% to the 1.47% estimated in 2012. Still the tobacco industry will continue to be worth more than $10 billion.
“Lifestyle changing endeavours such as smoking are popular resolutions each year, driven by increased knowledge of dangers, greater availability of assistance, restrictions on sales and higher taxes,” said Dobie.
Another popular resolution, especially after the festivities, is to cut back on the alcohol consumption. Still Australians will be drinking, on average, 10.5 litres of alcohol in 2012.
3. Eating better
Along with losing weight and quitting smoking comes eating better, as the three resolutions are usually linked to the desire to adopt an healthier lifestyle after the New Year.
With Australians becoming increasingly aware of organic food and getting away from processed products, the organic farming industry is expected to grow by 10.8% in 2012, meaning that it will be worth $541 million.
“Sales growth of organic produce has been strong for Coles and Woolworths, which are both offering an increasing range of organic produce,” said Dobie.
4. Seeing the world
Many Australians are also dreaming of travelling overseas, which can only mean good news for international airline operators.
According to Dobie, “more than 500,000 Aussies catch outbound flights each month, with South-East Asia and North America being among the most popular holiday destinations.”
In fact, in the last decade the number of Australians going overseas more than doubled.
With so many Australians taking trips abroad, domestic tourism operators will hardly grow in 2012 (a mere 0.4%).
5. Getting out of debt
Continuing a trend of the last few years, many Australians intend to pay their debt and increase savings in 2012.
As Dobie explains, “one of the most popular aims for Australians in 2011 was to increase savings and cut back debt – a resolution many achieved with the savings rate reaching as much as 14% of national income, its highest level in 25 years”.
IBISWorld expects that the average savings ratio will be 11% of the personal income in 2012.
6. Giving back to the community
In 2012, it is expected that Australian charities will raise $106.9 billion (a growth of 3.6% when compared to 2011), as six million Australians will donate their time and money to help those in need.
“This is also visible in the trend towards ethical consumerism, with sales of sustainably sourced and fair goods increasing significantly in the past five years,” said Dobie.
7. Expanding knowledge
Everybody knows that knowledge is power, more so in 2012. According to IBISWorld, 1.9 million Australians will be enlisting in a technical and educational course in 2012 to further increase and expand their curriculums or even just for fun.
According to Dobie, “more and more Australian adults are heading back to school for work, leisure or personal interest. In the coming year, $6.4 billion is expected to be spent on learning languages, business coaching, professional development, attending theological classes and even learn how to drive.”
Those between the ages of 25 and 64 will account for more than half of the enrollment numbers.
8. Getting into DIY
According to IBISWorld, many Australians will be turning into home improvers in 2012. After a tough 2011, many retailers can expect a better 2012 which will most definitely start on the right foot. In January alone, IBISWorld expects that Australians will be spending $1.0 billion on DIY.
“The holiday season is a perfect chance for many Australians to do the work around the house they have been putting off all year,” said Dobie.
“Traditionally December and January are the busiest months of the year for hardware stores and nurseries,” she added.
Photo by Herry Lawford