Christmas is just around the corner and many families are looking forward to it. But even though Austrians want to spend more money on average on gifts this year, many people still have to save. Nearly 180,000 households are not planning to put presents under the Christmas tree this year.
Lately it has been said again and again that Austrians want to spend more on Christmas this year than last year. Retailers also reported very positive sales developments on the first three shopping Saturdays. Given the high price increases in recent years, which have made electricity and gas, but also food, much more expensive, you wonder how this works. The answer in a nutshell: richer people are spending significantly more this year, but poorer households are spending significantly less on gifts this year.
“The predictions for Christmas activities in 2024 usually show only ‘half the truth’ with average values. The gap between households with the lowest and highest incomes is particularly evident in the run-up to Christmas. While households in the lower income quartile are still suffering from the aftermath of the inflation crisis and are cutting back on their Christmas purchases or having to skip them altogether, the highest income quartile is spending more than ever on Christmas presents,” Ernst Gittenberger summarizes. from the Institute for Trade, Sales and Marketing (IHaM) at the Johannes Kepler University Linz (JKU).
Households in the lowest income quartile are particularly affected by the spending brake. About a quarter of households in this country have to survive on a monthly net household income of less than 2,000 euros. Of this group, 17 percent say they will not buy Christmas presents at all this year. In absolute numbers this corresponds to almost 180,000 households. An above-average number of single households, unemployed people, young people and retirees are represented.
And when gifts are bought by people with lower incomes, they spend 290 euros per household (2023: 320 euros), considerably less than average. 21 percent of people with a low income emphasize that they increasingly go to cheap online stores, because it is cheaper there than in a store.
“We see that many low-income households (have to) save this year or resort to cheap platforms such as Temu. These behavioral changes are less about conscious decisions and more about adjustments to limited financial options,” emphasizes Christoph Teller, director of the Institute for Trade, Sales and Marketing (IHaM).
“Rich people” are obviously digging much deeper into their pockets for December 24th. The top income decile (net income of households above 500 euros per month) spends an average of 920 euros (2023: 900 euros), more than three times as much as the lowest income quarter.
Almost half of Christmas sales come from rich people
The financial strength is also reflected in the distribution of the entire revenue pie. Austrians are expected to spend around €2.23 billion on Christmas presents this year. Of this, 43 percent (950 million euros) goes to the richest 25 percent, but only 13 percent (300 million euros) goes to the lowest income quarter.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
